Form 941 – How To File Quarterly Tax Returns?

Published on: August 18, 2023

Last Updated on: February 29, 2024

Form 941

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The IRS Form 941 is also referred to as the Employer’s Quarterly Federal Tax Return. It is where companies or businesses report their payroll and income taxes they withheld from the wages of their employees. That, along with calculating and reporting the Social Security and the Medicare tax burden of the employer.

Although regular taxpayers that are required to pay the tax only once a year, many companies are bound to file quarterly tax returns.

Companies that fail to file IRS Form 941 on time or underreport their tax liabilities may get penalized by the IRS.

IRS Form 941 May Include The Following Details

Completing Form 941 includes reporting the following:

  • Wages that are paid.
  • Tips that employees reported.
  • The federal income tax that is withheld from the employee’s paycheck.
  • Employees and employers share Medicare taxes and Social Security.
  • Any additional Medicare taxes that are withheld from the paychecks of the employees.
  • Adjustments of the current quarter to Social Security, along with Medicare taxes for the fractions of sick pay, cents, tips, and/or group term life insurance.

Once you have calculated all these categories, IRS Form 941 will show how much the business needs to or should have paid to the government in order to cover its quarterly payroll tax responsibilities.

Which Businesses Need To File IRS Form 941?

Most companies that have active employees are required to file IRS Form 941 per quarter to report and evaluate employment taxes. Selective states have analogs to Form 941 that companies may also have to file in order to report employer taxes and income withholdings at the state level.

However, selective businesses are exempted from filing Form 941. Here are the circumstances under which a business is not required to file Form 941:

  • Businesses that operate seasonally do not require Form 941 filing if they have not hired anyone in a quarter.
  • If the business only hires farmworkers.
  • People that hire household employees like nannies or house help.

Deadlines For Filing Form 941

The deadline to file IRS Form 941 is exactly one month, which follows the last day of one reporting period.

However, the calendar deadlines to file IRS Form 941 are listed as follows:

  • First Quarter: 30th April for the period that covers 1st January to 31st March.
  • Second Quarter: 31st July for the period that covers 1st April to 30th June.
  • Third Quarter: 31st October for the period that covers 1st July to 30th September.
  • Fourth Quarter: 31st January for the period that covers 1st October to 31st December.

If the due date falls on a holiday or a weekend, then the IRS Form 941 is required to be filed by the immediate next business day. If a business is filed by mail, the return will be tracked back to the date of postage.

An additional ten days to file is given to those businesses that had paid their full employment tax deposits on time for the whole quarter that the return covers.

Filing IRS Form 941

Here are the ways in which you can file the IRS Form 941:

Submitting The Form

The quickest and easiest way to file IRS Form 941 is via the federal e-File system. Company taxpayers may access the eFile through multiple software for tax preparation for small businesses.

The tax professional or accountant of a business must also have access to e-File.

The Form 941 may also be filed through the mail. The mailing address will depend on the state where the business operates if the payment is submitted with returns, and what quarter it is filed for. Including the payment voucher is a must.

Making A Payment

Businesses can make a payment through the Electronic Federal Tax Payment System- EFTPS.

All tax payments that are related to IRS Form 941 can be made via EFTPS.

A check can also be mailed to the IRS.

A Step-By-Step Guide To IRS Form 941 Instructions

The IRS Form 941 comprises three pages. There are five parts and a payment voucher at the end in case the form is submitted through mail along with the payment.

Here is a brief guide as to how one is supposed to file the IRS Form 941.

Gather Information Required To Complete Form 941

The IRS Form 941 inquiries for the total tax that businesses have revoked on behalf of the employees for each quarter. To complete Form 941 efficiently and effectively, gathering all the necessary information beforehand is necessary.

This information may include:

  • Basic information about the business.
  • Total count of employees.
  • Total wages that are paid in the quarter.
  • Taxable Medicare and Social Security that is paid for the quarter.
  • The full amount of Social Security Taxes, federal income taxes, and Medicare taxes that are retained from employees.
  • The employment tax deposits that are already made in the quarter.

Fill in The Business Information At The Top Of Form 941

In the first section, the Form asks for the primary information about the business, along with the quarter that the Form is being filed for.

The employer identification number is to be provided in this section, along with the name, trade name, and business address.

Fill Out Part 1 Of Form 941

Part 1 of Form 941, is further broken down into 15 lines where businesses are supposed to give information about the paid wages, withheld federal income taxes, etc.

This is considered the most involving section in the Form because of the calculations involved on the fifth line. However, for the first four lines, the information can be easily gathered from the accounting or payroll software.

Fill Out Part 2 Of Form 941

Part 2 is entirely about the tax liabilities and deposit schedules for the quarter. This part will require businesses to mention if they are monthly or semiweekly scheduled depositors.

For monthly depositors, three boxes are required to be filled in, the total of which will equal the number on line 12 of Part 1.

For semiweekly depositors, Form 941 Schedule B is to be attached with the main form, which will break down the tax liabilities for individual days of the quarter.

Fill Out Parts 3 And 4 Of Form 941

Part 3 will ask questions if the business has closed, stopped giving wages to the employees, or if the employee is seasonal and does not fall under the spectrum of Form 941 for each quarter.

In Part 4, it is asked if the third-party designee is authorized to contact the IRS on behalf of the business regarding the tax return.

Review Form 941 Before Filling In Part 5

The whole of Form 941 is to be reviewed and double-checked for credibility before finally signing Part 5 of the form.

Submit Form 941 To The IRS And Pay All Remaining Balance

EFTPS can be used in case a business is filing the Form online. Alternatively, the return can also be mailed with a payment voucher.

Wrapping Up

The IRS Form 941 is a vital part of every operating business, failing which may land companies in major legal trouble.

Therefore, it is always better to hire an expert tax professional or an accountant who would lessen the burden and will also make sure the tax returns are filed without any failure. I hope this article has provided you with all the necessary insights on Form 941; however, if you still have any questions, drop a comment below!

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upasana sarbajna

Upasana is a budding journalist who has a keen interest in writing. She considers writing as therapeutic and is most confident when she writes. She is passionate about music, movies and fashion. She writes in a way that connects with the audience in a personal level. She is optimistic, fun loving and opinionated.

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