Federal 941 Payroll Tax Payment Recommendations


A lot of company house owners will not comprehend how crucial it is to get payroll tax payments designed on time. If a late payment is produced, as soon as the IRS catches up to it, the penalties are pretty stiff: 10% off the top, plus fascination. Consider earning that at a lender nowadays! Resist the temptation to shell out late, for the reason that it is really not a money saver, it is really a funds loser. In addition, penalties are not deductible.

Fast Suggestion: the IRS takes advantage of the phrase “tax deposit” to indicate “tax payment”, and makes use of the time period “month-to-month depositor” or “semi-weekly depositor” to necessarily mean “regular monthly payer” or “semi-weekly payer”, respectively.

Identify Your Payment Program

Just before you can identify when the tax payment is due, you ought to to start with figure out if you are a month-to-month depositor, or a semi-weekly depositor. Which style you are has almost nothing to do with when or how typically you pay out your workforce. In buy to identify which program you are on, analyze the payroll information in the course of the “lookback period”. This period always runs from July 1 to June 30. For 2006, the “lookback period of time” runs from July 1, 2004 – June 30, 2005. If the volume you withheld for 941 taxes is $50,000 or a lot less, you are a month to month depositor. If the amount of money for the duration of that interval is additional than $50,000, you are a semi-weekly depositor.

Regular monthly Depositor

If you are a monthly depositor, you will fork out the taxes by the 15th of the next thirty day period. For illustration, for 941 taxes withheld for the duration of August 2006, the payment was owing on Friday, September 15. If the 15th falls on a weekend or Federal getaway, the payment is because of the up coming company working day.

Semi-Weekly Depositor

  • If the payday falls on a Wednesday, Thursday, and/or Friday, the deposit is owing on or prior to the following Wednesday.
  • If the payday falls on a Saturday, Sunday, Monday, and/or Tuesday, the deposit is thanks on or before the adhering to Friday.

The $100,000 Rule

No matter of which form of depositor you are, if 941 withholdings reach $100,000 or extra, a payment is thanks the subsequent company working day, and the semi-weekly deposit regulations are in impact heading forward.

Payment Techniques

You may well make payments one particular of a few techniques:

  • The IRS will deliver you a yellow booklet that contains coupon codes. Fill just one out, and choose a look at to your lender. Be absolutely sure to fill out the top rated stub of the coupon for your records.
  • Use the Electronic Federal Tax Payment Procedure. Take a look at eftps.com for additional information and facts and to indicator up. Make it possible for about two months for the enrollment course of action to total. Other varieties of taxes can be paid as very well, employing this procedure.
  • Come across a payroll supplier who provides digital payment of work taxes, and enroll in that escort support in DC.

Stay away from High-priced Penalties

  • Really don’t pay late
  • Shell out applying the correct process
  • Fork out the accurate volume

These tips are for Federal 941 payments only, and are intended for small organizations who have beneath $100,000 in Federal 941 payroll liabilities. See the Recommendations for Sort 941, and Circular E for additional element and data.


Supply by Jennifer A. Thieme