Instructions for Form 941 - Introductory Material


Future Developments

For the latest information about developments related to Form 941 and its instructions, such as legislation enacted after they were published, go to www.irs.gov/form941.

What's New

Social security and Medicare tax for 2015.   The social security tax rate is 6.2% each for the employee and employer, unchanged from 2014. The social security wage base limit is $118,500.

  The Medicare tax rate is 1.45% each for the employee and employer, unchanged from 2014. There is no wage base limit for Medicare tax.

  Social security and Medicare taxes apply to the wages of household workers you pay $1,900 or more in cash or an equivalent form of compensation in 2015. Social security and Medicare taxes apply to election workers who are paid $1,600 or more in cash or an equivalent form of compensation in 2015.

  

Leave-based donation programs to aid victims of the Ebola Virus Disease (EVD) outbreak in Guinea, Liberia, and Sierra Leone.   Under these programs, employees may donate their vacation, sick, or personal leave in exchange for employer cash payments made before January 1, 2016, to qualified tax-exempt organizations providing relief for the victims of the EVD outbreak in Guinea, Liberia, and Sierra Leone. The donated leave will not be included in the income or wages of the employee. The employer may deduct the cash payments as business expenses or charitable contributions. For more information, see Notice 2014-68, 2014-47 I.R.B. 842, available at www.irs.gov/irb/2014-47_IRB/ar11.html.

Work opportunity tax credit for qualified tax-exempt organizations hiring qualified veterans extended.   The work opportunity tax credit is now available for eligible unemployed veterans who began work after December 31, 2013, and before January 1, 2015. Qualified tax-exempt organizations that hire eligible unemployed veterans can claim the work opportunity tax credit against their payroll tax liability using Form 5884-C, Work Opportunity Credit for Qualified Tax-Exempt Organizations Hiring Qualified Veterans. For more information, visit IRS.gov and enter “work opportunity tax credit” in the search box.

Online payment agreement.   You may be eligible to apply for an installment agreement online if you have a balance due when you file your return. For more information, see What if you cannot pay in full, later.

Reminders

COBRA premium assistance credit.   Effective for tax periods beginning after December 31, 2013, the credit for COBRA premium assistance payments cannot be claimed on Form 941. Instead, after filing your Form 941, file Form 941-X, Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund, to claim the COBRA premium assistance credit. Filing a Form 941-X before filing a Form 941 for the quarter may result in errors or delays in processing your Form 941-X. For more information, visit IRS.gov and enter “COBRA” in the search box.

  
If you are entitled to claim the COBRA premium assistance credit, but are not otherwise required to file Form 941, file a Form 941 with -0- entered on line 12 before filing a Form 941-X to claim the credit.

Additional Medicare Tax withholding.   In addition to withholding Medicare tax at 1.45%, you must withhold a 0.9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Additional Medicare Tax is only imposed on the employee. There is no employer share of Additional Medicare Tax. All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold.

  For more information on what wages are subject to Medicare tax, see the chart, Special Rules for Various Types of Services and Payments, in section 15 of Pub. 15 (Circular E), Employer's Tax Guide. For more information on Additional Medicare Tax, visit IRS.gov and enter “Additional Medicare Tax” in the search box.

Aggregate Form 941 filers.   Agents must complete Schedule R (Form 941), Allocation Schedule for Aggregate Form 941 Filers, when filing an aggregate Form 941. Aggregate Forms 941 are filed by agents approved by the IRS under section 3504. To request approval to act as an agent for an employer, the agent files Form 2678, Employer/Payer Appointment of Agent, with the IRS.

Correcting a previously filed Form 941.   If you discover an error on a previously filed Form 941, make the correction using Form 941-X. Form 941-X is filed separately from Form 941. For more information, see section 13 of Pub. 15 (Circular E) or visit IRS.gov and enter “correcting employment taxes” in the search box.

Employers can choose to file Forms 941 instead of Form 944.   Employers that would otherwise be required to file Form 944, Employer's ANNUAL Federal Tax Return, can notify the IRS if they want to file quarterly Forms 941 instead of annual Form 944. To request to file quarterly Forms 941 to report your social security and Medicare taxes for the 2015 calendar year, you must either call the IRS at 1-800-829-4933 between January 1, 2015, and April 1, 2015, or send a written request postmarked between January 1, 2015, and March 16, 2015. After you contact the IRS, the IRS will send you a written notice that your filing requirement has been changed to Forms 941. You must receive written notice from the IRS to file Forms 941 instead of Form 944 before you may file these forms. If you do not receive this notice, you must file Form 944 for calendar year 2015. See Rev. Proc. 2009-51, 2009-45 I.R.B. 625, available at www.irs.gov/irb/2009-45_IRB/ar12.html.

Requesting to file Form 944 instead of Forms 941.   If you are required to file Forms 941 but believe your employment taxes for the calendar year will be $1,000 or less, you may request to file Form 944 instead of Forms 941 by calling the IRS at 1-800-829-4933 between January 1, 2015, and April 1, 2015, or sending a written request postmarked between January 1, 2015, and March 16, 2015. After you contact the IRS, the IRS will send you a written notice that your filing requirement has been changed to Form 944. You must receive written notice from the IRS to file Form 944 instead of Forms 941 before you may file this form. If you do not receive this notice, you must file Forms 941 for calendar year 2015. See Rev. Proc. 2009-51, 2009-45 I.R.B. 625, available at www.irs.gov/irb/2009-45_IRB/ar12.html.

Federal tax deposits must be made by electronic funds transfer (EFT).   You must use EFT to make all federal tax deposits. Generally, an EFT is made using the Electronic Federal Tax Payment System (EFTPS). If you do not want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. Also, you may arrange for your financial institution to initiate a same-day wire payment on your behalf. EFTPS is a free service provided by the Department of Treasury. Services provided by your tax professional, financial institution, payroll service, or other third party may have a fee.

  For more information on making federal tax deposits, see section 11 of Pub. 15 (Circular E). To get more information about EFTPS or to enroll in EFTPS, visit www.eftps.gov, or call 1-800-555-4477 or 1-800-733-4829 (TDD). Additional information about EFTPS is also available in Pub. 966, Electronic Federal Tax Payment System: A Guide To Getting Started.

  
For an EFTPS deposit to be on time, you must submit the deposit by 8 p.m. Eastern time the day before the date the deposit is due.

Same-day wire payment option.

If you fail to submit a deposit transaction on EFTPS by 8 p.m. Eastern time the day before the date a deposit is due, you can still make your deposit on time by using the Federal Tax Collection Service (FTCS). To use the same-day wire payment method, you will need to make arrangements with your financial institution ahead of time. Please check with your financial institution regarding availability, deadlines, and costs. Your financial institution may charge you a fee for payments made this way. To learn more about the information you will need to provide your financial institution to make a same-day wire payment, visit the IRS website at www.irs.gov/e-pay and click on Same-Day Wire Federal Tax Payments.

Timeliness of federal tax deposits.

If a deposit is required to be made on a day that is not a business day, the deposit is considered timely if it is made by the close of the next business day. A business day is any day other than a Saturday, Sunday, or legal holiday. The term “legal holiday” for deposit purposes includes only those legal holidays in the District of Columbia. Legal holidays in the District of Columbia are provided in Pub. 15 (Circular E).

Electronic filing and payment.   Now, more than ever before, businesses can enjoy the benefits of filing tax returns and paying their federal taxes electronically. Whether you rely on a tax professional or handle your own taxes, the IRS offers you convenient programs to make filing and paying easier. Spend less time and worry about taxes and more time running your business. Use e-file and EFTPS to your benefit.
  • For e-file, visit the IRS website at www.irs.gov/efile for additional information.

  • For EFTPS, visit www.eftps.gov, or call EFTPS Customer Service at 1-800-555-4477 or 1-800-733-4829 (TDD) for additional information.

  
If you are filing your tax return or paying your federal taxes electronically, a valid employer identification number (EIN) is required at the time the return is filed or the payment is made. If a valid EIN is not provided, the return or payment will not be processed. This may result in penalties.

Electronic funds withdrawal (EFW).

If you file Form 941 electronically, you can e-file and e-pay (EFW) the balance due in a single step using tax preparation software or through a tax professional. However, do not use EFW to make federal tax deposits. For more information on paying your taxes using EFW, visit the IRS website at www.irs.gov/e-pay. A fee may be charged to file electronically.

Credit or debit card payments.   Employers can pay the balance due shown on Form 941 by credit or debit card. Do not use a credit or debit card to make federal tax deposits. For more information on paying your taxes with a credit or debit card, visit the IRS website at www.irs.gov/e-pay.

Paid preparers must sign Form 941.   Paid preparers must complete and sign the paid preparer's section of Form 941.

Outsourcing payroll duties.   Employers are responsible to ensure that tax returns are filed and deposits and payments are made, even if the employer contracts with a third party to perform these acts. The employer remains responsible if the third party fails to perform any required action. If you choose to outsource any of your payroll and related tax duties (that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes) to a third-party payer, such as a payroll service provider or reporting agent, visit IRS.gov and enter “outsourcing payroll duties” in the search box for helpful information on this topic.

Where can you get telephone help?   For answers to your questions about completing Form 941 or tax deposit rules, you can call the IRS at 1-800-829-4933 or 1-800-829-4059 (TDD/TTY for persons who are deaf, hard of hearing, or have a speech disability), Monday–Friday from 7:00 a.m. to 7:00 p.m. local time (Alaska and Hawaii follow Pacific time).

Photographs of missing children.   The IRS is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in instructions on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.


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