Final answer:
Employers in the United States are classified into two categories for the timing of federal payroll tax deposits: monthly or semiweekly. This classification determines when they must deposit collected payroll taxes. The correct depositor status classifications are monthly or semiweekly.The correct option is C.
Step-by-step explanation:
In the United States, employers are required to withhold and pay payroll taxes on behalf of their employees. These taxes include federal income tax, Social Security and Medicare taxes, unemployment taxes, and in some cases, state and local taxes.
The Internal Revenue Service (IRS) classifies employers into two depositor status categories for federal payroll tax deposits: monthly or semiweekly. This classification affects when an employer must deposit payroll taxes.
For instance, an employer classified as a monthly depositor must generally deposit employment taxes on payments made during a month by the 15th day of the following month. An employer classified as a semiweekly depositor has different deadlines that are determined based on the day of the week they pay wages. It is important for employers to know their depositor status because late deposits can result in penalties and interest charges.
Therefore, the correct answer to the question is C. Monthly or semiweekly.