Quarterly provider statement and oversight checklist

Template from tincompliance.com. Two documents in one file. Part 1 is the quarterly written statement a reporting agent owes each client under Rev. Proc. 2012-32: the agent "must advise the client that it remains responsible for the timely filing of tax returns and timely payment of employment taxes" in "a quarterly, written statement," which "also includes a recommendation for the client to enroll in EFTPS to monitor its account" (IRM 5.1.24.4.3(9), Mar. 24, 2025). A payer can hand this text to its reporting agent as the statement it expects to receive, or use it to check the one it gets. Part 2 is the oversight checklist a payer runs when the statement arrives, built from the warning signs the collection manual lists for revenue officers (IRM 5.1.24.5.2 through 5.1.24.5.4) and the limits of Form 8655 in IRM 21.3.9 (Oct. 1, 2026). The manual is written in Form 940 and 941 terms; it never mentions Form 945 outside the Section 3504 agent return list or backup withholding at all, so the Form 945 lines below apply the same principles to nonpayroll withholding. Bracketed items are placeholders.

Part 1. Quarterly statement from reporting agent to client

[Reporting agent legal name]

EIN: [00-0000000]

[Reporting agent address]

[Date]

[Client legal name]

EIN: [00-0000000]

[Client address of record with the IRS]

Re: Quarterly statement under Rev. Proc. 2012-32; quarter ended [March 31 / June 30 / September 30 / December 31], [YYYY]; Form 8655 dated [date]

Dear [Client contact]:

[Reporting agent] acts as your reporting agent under the Form 8655, Reporting Agent Authorization, you signed on [date], covering Forms [940 / 941 / 943 / 944 / 945 / 1042] beginning with the [quarter / year] [period]. This statement is provided each quarter as required by Rev. Proc. 2012-32.

You remain responsible for the timely filing of your tax returns and the timely payment of your employment taxes, including any nonpayroll withholding reported on Form 945, even though [Reporting agent] prepares, signs and files those returns and makes the deposits on your behalf. Our authorization does not transfer that liability to us. If a return is not filed or a deposit is not made on time, the IRS will assess any tax, penalty and interest against your account.

We recommend that you enroll in the Electronic Federal Tax Payment System (EFTPS) at eftps.gov, or activate the EFTPS Inquiry PIN the IRS mailed to you when we enrolled you as a batch-provider client, so that you can independently monitor the deposits we make under your EIN. EFTPS shows 16 months of payment history and allows you to make a payment yourself if one is missing.

The two paragraphs above are the substance the revenue procedure requires: the liability reminder and the EFTPS recommendation (IRM 5.1.24.4.3(9)). EFTPS Inquiry PINs have been issued automatically to new batch-provider clients since January 24, 2014 (IRM 5.1.24.5.3, Mar. 2, 2018). Everything below is optional detail a payer should ask for; a statement that omits it still satisfies the procedure, but one that includes it is easier to check.

Returns filed this quarter

Deposits made this quarter under your EIN

IRS correspondence received as duplicate copies (Form 8655 Line 17)

[None received this quarter. / Copies of the following were received and are enclosed: [notice or letter number], dated [date], regarding Form [form] for [period].] These are duplicates; the original was mailed to your address of record. Our authorization does not permit us to request penalty abatement, argue facts, appeal, request credit transfers or change your address on your behalf; those require your own letter or a Form 2848.

Questions may be directed to [name, title], [phone], [email].

[Signature]

[Name], [Title]

[Reporting agent legal name]

Form 8655 "does not authorize an RA to request penalty abatement, argue facts, or appeal a denied request on behalf of the taxpayer without Form 2848," nor credit transfers, nor a change of address (IRM 21.3.9.1.1(1) Notes; 21.3.9.2.2(1) Note; 21.3.9.2.2(6), Oct. 1, 2026). Duplicate notice copies go to the agent without the inserts (IRM 21.3.9.1.1(1) Note), so the client copy is the complete one.

Part 2. Payer oversight checklist (run each quarter when the statement arrives)

Payer: [Company legal name], EIN [00-0000000]. Reporting agent: [name], EIN [00-0000000]. Quarter: [Qn YYYY]. Completed by: [name, title], [date].

A. The statement itself

☐ The quarterly written statement was received on [date] for the quarter ended [date] (Rev. Proc. 2012-32; IRM 5.1.24.4.3(9)). If none was received, request it in writing on [date].

☐ The statement says in substance that the payer remains responsible for timely filing and payment, and recommends EFTPS enrollment. Missing either element: note it and ask the agent to correct the next one.

☐ Forms and periods listed on the statement match the forms on the Form 8655 we signed, including Form 945 if we backup withhold. A Form 945 line that the IRS did not add to the RAF because our entity had no filing requirement would leave Form 945 unlisted (IRM 21.3.9.3.1(3) Note, Oct. 1, 2026).

B. EFTPS: verify the deposits independently

☐ We have our own EFTPS enrollment or an activated EFTPS Inquiry PIN (issued automatically to batch-provider clients since Jan. 24, 2014; 16 months of history) (IRM 5.1.24.5.3, Mar. 2, 2018). If neither: enroll by [date]; do not rely on the agent's reports alone.

☐ Every deposit on the agent's statement appears in EFTPS under our EIN, on the date and in the amount shown, keyed to the correct form (941 or 945) and period. Any deposit missing, late or keyed to the wrong form is listed below with the date we found it.

☐ Form 945 deposits were made on the schedule that applies to our nonpayroll withholding, separately from Form 941 deposits.

"A 'red flag' should arise the first time a payroll service provider misses or makes a late payment" (IRM 5.1.24.5.3(1), Mar. 2, 2018). If a deposit is missing, pay it yourself through EFTPS the same day; the Inquiry PIN "lets the employer pay what the provider is not authorized to pay." Then record the date of discovery and the action taken; timeliness of corrective action "once the employer had actual knowledge" is an abatement factor (IRM 5.1.24.5.5(2)-(3), Mar. 24, 2025).

C. Address of record and notice copies

☐ Our IRS address of record is still our own address, not the agent's. Checked against [the most recent IRS notice / a transcript / an IRS call] on [date]. Form 8655 cannot change an address; only we can, on Form 8822-B (IRM 21.3.9.2.2(6)).

☐ IRS mail is arriving at our address at the expected frequency. A stop in IRS mail is investigated, because "A third-party payer may sometimes improperly change its client's address of record to that of the third-party payer to limit the client's ability to be informed of tax matters," and "An unauthorized change of address made by an employer's third-party payer is a potential indicator of fraud" (IRM 5.1.24.5.4, Mar. 24, 2025).

☐ Every IRS notice or letter we received this quarter is logged, opened and compared with the duplicate copies the agent reports receiving under Form 8655 Line 17. A notice the agent has and we do not means our copy went somewhere else.

☐ Any letter confirming an account action we did not request has been traced: the IRS sends "a letter to the taxpayer's address of record confirming the account status" whenever it acts on information from our agent (IRM 21.3.9.1.1(1) Note).

Officers remain exposed to the trust fund recovery penalty, and one willfulness factor is "Whether the client had received prior IRS notices indicating that employment tax returns had not been filed, or are inaccurate, or that employment taxes had not been paid" (IRM 5.1.24.5.8, May 20, 2026). Unopened notices are evidence against the payer, not the provider.

D. Returns: reconcile our copies to what the IRS holds

☐ The Form 941 (each quarter) and Form 945 (annually) copies the agent gave us agree with an IRS account transcript or with the tax and deposits shown in EFTPS. "A tactic used by third-party payers, intent on defrauding clients, is to provide clients with accurate employment tax returns, W-2s, and W-3 while filing employment tax and informational returns with the IRS that understate the amount of wages" (IRM 5.1.24.5.2(5), May 20, 2026).

☐ Returns were filed under our EIN, not the agent's. A provider that files under its own EIN without being a Section 3504 agent or a CPEO leaves us with nothing "to reconcile with IRS records" (IRM 5.1.24.5.2(6)), and a PEO that files without allocating wages to clients means "the client will not get credit for having paid employment taxes" (IRM 5.1.24.6.3(6)).

☐ Form 945 line 3 total tax agrees with the backup withholding shown in box 4 of the Forms 1099 we filed for the year (annual check).

E. Form 8655 status

☐ The Form 8655 on file was signed within one year of the date it was submitted to the IRS and covers the forms we use (IRM 21.3.9.3.2(2)). Signature date: [date]. Submitted: [date].

☐ The name on the agent's filing matches our IRS name control on the first four characters; a mismatch puts the account on the ERROR listing "Not added to RAF" (IRM 21.3.9.4.2.2(1)).

☐ Any former reporting agent has been revoked, by re-signing a copy of the old Form 8655 with REVOKE across the top or by signed statement (IRM 21.3.9.5.2). A new Form 8655 "does not revoke a prior reporting agent authorization" (IRM 21.3.9.2.2(4)). Former agents: [none / name, revoked on date].

☐ Our contract with the agent is understood as a claim against the agent only. "Liability is always determined by the provisions of the Internal Revenue Code ... and cannot be altered by a private agreement or contract" (IRM 5.1.24.1.1(4), Mar. 2, 2018).

F. Exceptions found this quarter

Keep the completed checklist with the quarter's records. If a provider failure is later established, the documentation the revenue officer looks for is exactly this: that the payer had the funds and the provider "timely received or debited the funds," when the payer had actual knowledge, what it did and how fast, and whether the provider "used fraud or deception to conceal the noncompliance" (IRM 5.1.24.5.5(2)-(3)). Penalties are then "considered for abatement"; interest is not: "Under no circumstances may interest be removed for reasonable cause" (IRM 5.1.24.5(2); 5.1.24.5.5(2)).