1545-2254 Supporting Statement 2021

1545-2254 Supporting Statement 2021.docx

Form 4219, Statement of Liability of Lender, Surety, or Other Person for Withholding Taxes

OMB: 1545-2254

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SUPPORTING STATEMENT

Internal Revenue Service

Form 4219, Statement of Liability of Lender, Surety,

or Other Person for Withholding Taxes

OMB Control Number 1545-2254


  1. CIRCUMSTANCES NECESSITATING COLLECTION OF INFORMATION


Internal Revenue Code (IRC) Section 3505 deals with persons who supply funds to an employer for the purpose of paying wages. Third parties who directly pay another's payrolls can be held liable for the full amount of taxes required to be withheld but not paid to the Federal Government (subject to the 25% limitation). The notification that a third party is paying or supplying wages will usually be made by filing of the Form 4219, Statement of Liability of Lender, Surety, or Other Person for Withholding Taxes.


Form 4219, Statement of Liability of Lender, Surety, or Other Person for Withholding Taxes is to be submitted and associated with each employer and for every calendar quarter for which a liability under section 3505 is incurred.


  1. USE OF DATA


The Form 4219 may be received from the third party or taxpayer and subsequently associated with the applicable quarterly filed Form 941 to either confirm payment or nonpayment of the tax liability. If full payment of tax is not received, the Form 4219 can be used to assist with the necessary investigation and potential initiation of a suit against the third party for tax collection under Section 3505 within ten years after the assessment of the tax against the employer.

  1. USE OF IMPROVED INFORMATION TECHNOLOGY TO REDUCE BURDEN


IRS Publications, regulations, published guidance, e.g., revenue rulings and revenue procedures, notices, letters, and letter rulings are to be electronically enabled on an ‘as practicable’ basis in accordance with the IRS Reform and Restructuring Act of 1998. The Agency doesn’t plan to offer electronic filing for Form 4219 at this time due to the low volume of filings, but the paper-only filing method maybe reassessed in the future.



  1. EFFORTS TO IDENTIFY DUPLICATION


The information obtained through this collection is unique and is not already available for use or adaption from another source.




  1. METHODS TO MINIMIZE BURDEN ON SMALL BUSINESSES OR OTHER SMALL ENTITIES


The IRS proactively works with both internal and external stakeholders to minimize the burden on small businesses, while maintaining tax compliance. The Agency also seeks input regarding the burden estimates from the public via notices and tax product instructions. The Agency will continue to as applicable find ways to reduce the burden on small businesses or other small entities.


6. CONSEQUENCES OF LESS FREQUENT COLLECTION ON FEDERAL PROGRAMS OR POLICY ACTIVITIES


The information required is needed to verify compliance with Section 3505 of the Internal Revenue Code of the Treasury Regulations. A less frequent collection of taxes and tax information could adversely affect the government’s effectiveness and would reduce the oversight of the public in ensuring compliance with Internal Revenue Code and hinder the IRS from meeting its mission.


  1. SPECIAL CIRCUMSTANCES REQUIRING DATA COLLECTION TO BE INCONSISTENT WITH GUIDELINES IN 5 CFR 1320.5(d)(2)


There are no special circumstances requiring data collection to be inconsistent with Guidelines in 5 CFR 1320.5(d)(2).


8. CONSULTATION WITH INDIVIDUALS OUTSIDE OF THE AGENCY ON AVAILABILITY OF DATA, FREQUENCY OF COLLECTION, CLARITY OF INSTRUCTIONS AND FORMS, AND DATA ELEMENTS


In response to the Federal Register notice dated November 19, 2020 (85 FR 73843), we received no comments during the comment period regarding these regulations.


  1. EXPLANATION OF DECISION TO PROVIDE ANY PAYMENT OR GIFT TO

RESPONDENTS


No payment or gift has been provided to any respondents.



  1. ASSURANCE OF CONFIDENTIALITY OF RESPONSES


Generally, tax returns and tax return information are confidential as required by 26 USC 6103.




  1. JUSTIFICATION OF SENSITIVE QUESTIONS


A privacy impact assessment (PIA) has been conducted for information collected under this request as part of the “Business Master File (BMF)” system and a Privacy Act System of Records notice (SORN) has been issued for this system under IRS 24.046-Customer Account Data Engine Business Master File. The Internal Revenue Service PIAs can be found at

https://www.irs.gov/uac/Privacy-Impact-Assessments-PIA


Title 26 USC 6109 requires inclusion of identifying numbers in returns, statements, or other documents for securing proper identification of persons required to make such returns, statements, or documents and is the authority for social security numbers (SSNs) in IRS systems.


  1. ESTIMATED BURDEN OF INFORMATION COLLECTION


Authority

Description

# Respondents

# Responses Per Respondent

Total Annual Responses

Hours Per Response

Total Burden

IRC 3505

Form 4219

1,000

1

1,000

12.8333

12,833


Totals

1,000


1,000


12,833

The following regulation impose no additional burden. Please continue to assign OMB number 1545-2254 to this regulation:


31.3505-1

  1. ESTIMATED TOTAL ANNUAL COST BURDEN TO RESPONDENTS


To ensure more accuracy and consistency across its information collections, IRS is currently in the process of revising the methodology it uses to estimate burden and costs. Once this methodology is complete, IRS will update this information collection to reflect a more precise estimate of burden and costs.


14. ESTIMATED ANNUALIZED COST TO THE FEDERAL GOVERNMENT


After consultation with various functions within the Service, we have determined that the cost of developing, printing, processing, distribution and overhead for the Form is $5,000.





  1. REASONS FOR CHANGE IN BURDEN


There is no change in the paperwork burden previously approved by OMB. We are making this submission to renew the OMB approval.

  1. PLANS FOR TABULATION, STATISTICAL ANALYSIS AND PUBLICATION


There are no plans for tabulation, statistical analysis, and publication.


  1. REASONS WHY DISPLAYING THE OMB EXPIRATION DATE IS INAPPROPRIATE


IRS believes that displaying the OMB expiration date is inappropriate because it could cause confusion by leading taxpayers to believe that the form and/or regulation sunsets as of the expiration date. Taxpayers are not likely to be aware that the Service intends to request renewal of the OMB approval and obtain a new expiration date before the old one expires.


  1. EXCEPTIONS TO THE CERTIFICATION STATEMENT


There are no exceptions to the certification statement.


Note: The following paragraph applies to all of the collections of information in this submission:


An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection of information displays a valid OMB control number. Books or records relating to a collection of information must be retained as long as their contents may become material in the administration of any internal revenue law. Generally, tax returns and tax return information are confidential, as required by 26 U.S.C. 6103.

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