Got CP2100

Now I Owe Form 945 Tax?  

What is Form 945 Tax?!

24% BWH!-B!!

Under BWH-B program you (Payor) failed to provide correct taxpayer (Payee) Identification Number (TIN) on Info Return such as 1099-MISC, then a 24% backup withholding (24% BWH-B) is required on future payments to Payee.

Payor begins 24% BWH-B after IRS issues notice CP2100 OR CP2100(A).  IRS will issue CP2100 if Payee’s name & TIN on 1099-MISC filed does not match IRS records.  The CP2100 is the notice for Payor to fix TIN NOW! Or begin 24% BWH-B!

BWH-B, the B Backup Withholding program IRC 3406 says 24% BWH-B applies when Payor pays Payee if:

  1. Never received TIN from Payee
  2. CP2100 issued & Payee has not furnished the correct TIN in a timely manner.

Follow specific IRS documentation instructions for notifying taxpayer of TIN issue, as required.  Seek counsel from Sauri Tax for Special Rules on Solicitations made by mail to Payee.  

Payee has become subject to 24% BWH-B if:

  1. Never provided TIN to Payor
  2. IRS notice CP2100 to Payor that TIN provided is missing or incorrect.  

For Payee to stop 24% BWH-B provide correct TIN to Payor.

Use Form 945 Annual Return of Withheld Federal Income Tax to report & remit 24% BWH-B.

File Form 945 and PAY 24% BWH-B with IRS by January 31 of the following year. 

If the total amount of 24% BWH-B is:

  • Less than $2,500, you’re not required to make deposits during the year. 
  • $2500 – $50K = monthly depositor
  • More than $50K = Semi-Weekly depositor

Where to call for help: If you have any questions about backup withholding, information reporting, Forms 1099, or the CP2100 or CP2100A (less than 50) Notices and listing(s), you may call the Information Reporting Program Customer Service Section (call site): Toll-Free Telephone: (866) 455-7438. Hours: 8:30 a.m. to 4:30 p.m. Monday through Friday EST. 


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