If you are a business employer who is not a farmer, you will file
the quarterly Form 941 to
report wages you have paid, tips your employees have received, federal
income tax withheld, Social Security and Medicare taxes withheld, your
share of Social Security and Medicare taxes, and advance earned income
credit (AEIC) payments. A separate Form 941 is filed for each quarter.
The first quarter is January through March. The second quarter is April
through June. The third quarter is July through September. The fourth quarter
is October through December. Form 941 is due by the last day of the month
following the end of the quarter. For example, wages you pay during the
first quarter, January through March, must generally be reported on Form
941 by April 30th. If the due date for filing a return falls on a Saturday,
Sunday or legal holiday, you may file the return on the next business day.
Most employers are required to deposit their employment taxes before
the Form 941 is filed. For the rules for making deposits, select Topic
757. If you have deposited all your tax on time, you may file Form
941 ten days after it would normally be due.
The total Social Security and Medicare taxes on Form 941 may differ
by a small amount from the total on your payroll records, due to fractions
of cents that you gained or lost when computing separate amounts for individual
employees. You may add or subtract this difference on the line for Social
Security and Medicare adjustments. Generally, this should not be more than
a few cents. You may also use this adjustment line to correct the Social
Security and Medicare taxes you were unable to collect on employees' tips,
or for sick pay wages you report but for which Social Security and Medicare
taxes were withheld by a third party, such as an insurance company.
The income tax withheld and Social Security and Medicare taxes are
added together on Form 941. If you made advance earned income credit payments
to employees during the quarter, the total amount is subtracted from your
total taxes. Select Topic 754 for more information
on advance earned income credit.
The resulting net tax, is the amount of employment taxes you owe
for the quarter. If this amount is $1,000 or more, you must also complete
the Monthly Summary of Federal Tax Liability portion of Form 941 if you
are a monthly schedule depositor, or Schedule B of Form 941, if you are
a semi-weekly depositor. The purpose of this part of the form is to show
the IRS when you were required to make deposits and, whether they were
made timely.
On the record of liability (the monthly summary or schedule B), you
must show the combined amount of Social Security, Medicare, and income
tax owed for each month or day. Your liability for employment taxes occurs
when you actually pay the employees their wages, not when the pay period
ends. For example, if your pay period ends September 24th, but you do not
pay the employees until October 1st, their wages would be reported in the
fourth quarter, when you actually became liable for the tax, not the third
quarter when the pay period ended.
It is very important that you complete the tax liability record correctly,
or it may appear that you did not deposit your taxes when due. There is
a late deposit penalty ranging from 2% to 15%, depending on the length
of time the deposit is late.
Generally, if your tax liability for the quarter is $1,000 or more
and you have made the proper deposits, you should not have a balance due
with Form 941. Generally, only taxpayers with a tax liability of less than
$1,000 may pay with the tax return. If you pay taxes with your tax return
that should have been deposited, you may be subject to a penalty. Be sure
Form 941 is signed and dated before mailing it to your service center.
Publications you may find helpful are Publication
15, Employer's Tax Guide, and Publication
15-A, Employer's Supplemental Tax Guide. Publications can be
downloaded from this site,
or ordered by calling 1-800-829-3676.
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