Many small business owners are required to file Form 941 quarterly. Whether you’ve filed before or not, you may still have some questions. There can be a bit of confusion about when you need to use this form!
At CSI Accounting & Payroll, we’ve helped small businesses with their taxes for over 50 years. That means we’ve gotten a lot of questions about tax forms, including these questions about Form 941:
- What is Form 941? What is it used for?
- Do I need to file Form 941? What if I have no payroll?
- How do I fill out Form 941? Where do I send it, and when is it due?
What Form 941 Is Used For
Form 941 is the Employer's Quarterly Federal Tax Return, but it’s often referred to as your federal quarterly tax return.
This is how you report the total amounts paid to your employees, the amounts and dates the tax liabilities were incurred, and how much of the tax liabilities you paid. It helps you stay in compliance with the IRS.
The IRS compares the liabilities to the tax deposits that you made throughout the quarter. If the numbers don’t match up to have a balance of $0, they send a letter.
If you overpaid, they’ll inform you of the overage and ask where you’d like to apply the credits. If you underpaid, they’ll inform you of how much you were short and any penalties and interest assessed for late payments.
Who Needs to File Form 941
You don’t need to do these if you have been notified by the IRS that you must file Forms 943 or 944 instead.
Essentially, anybody who has payroll must file this form, provided you withhold more than $1k annually in Social Security, Medicare, and federal income taxes from your employees’ wages. If it’s less than $1k, you will need to file Form 944 annually.
If you are someone who needs to file a quarterly 941, you need to file this form every quarter, regardless of how much tax you owe.
If you don’t need to file this quarter but have filed in the past without marking it as a final return, then the IRS is still expecting a return from you this quarter. In this instance, you would file a return that shows zero liabilities.
How to Fill out and Submit Form 941
To complete your Form 941, you can find the instructions included with your form. The IRS also offers additional instructions.
Each quarterly tax return is due by the last day of the month that follows each quarter. For 2024, this is April 30, July 31, October 31, and then January 31 in 2025. Due dates are pushed to the next business day if they fall on a weekend or an observed holiday.
If there are any payments owed that total less than $2,500 for the quarter, they are also due at this time or made in deposits throughout the quarter. (If the liability is over $2,500 for the quarter, follow the depositor schedules below.)
If your tax liability over the past year was $50,000 or less, then you’re a monthly depositor and must deposit taxes by the 15th of the following month. If your liability was over $50,000, you’re a semiweekly depositor and should make deposits on a Wednesday (if your payroll is run on Wednesday through Friday) or Friday (if your payroll is run on Saturday through Tuesday).
Payments can be made with the attached Form 941-V. If you file or pay late, there is a penalty of five percent per month, up to a maximum of 25 percent.
You can submit the form via a mailed paper return or upload to the IRS website.
It’s important to file correctly. If a mistake was made in a prior quarter of the same year, then you should file a Form 941-X to adjust that quarter. If you need to do this for a quarter in a prior year, then you also need to adjust that year’s Form W-2 so they will match. It can take a lot of work to fix old mistakes.
Don’t Worry About Your 941s!
If you’re struggling with the process or aren’t sure if you need to file or not, CSI Accounting & Payroll can handle this for you as part of a standard payroll package.
Now that you know what Form 941 is used for, whether or not you need to file it, and how to complete the form, are you ready to check out payroll services to stay in compliance?
If so, please consider CSI Accounting & Payroll! To see if we can be a good fit for your business, click the button below for a free consultation:
Not ready to talk? That’s okay! First, check out our Small Business Payroll Kit, which includes a calendar that’s updated each year with 941 due dates and much more!
