2023 IRS Form 941 Deposit Rules and Schedule 

2023 IRS Form 941 Deposit Rules and Schedule

Oct 18, 2022

Released September 30, 2022

Notice 931 sets the deposit rules and schedule for Form 941

This information is also used for Forms: 943, 944, 945, and CT-1.

Two Deposit Schedules

There are two deposit schedules—monthly or semiweekly—for determining when you deposit social security and Medicare taxes and withheld federal income tax. These schedules tell you when a deposit is due after a tax liability arises (for example, when you have a payday). Before the beginning of each calendar year, you must determine which of the two deposit schedules you must use. You must use the deposit schedule based on the total tax liability you reported during a lookback period. Your deposit schedule isn't determined by how often you pay your employees or make deposits.

941 Monthly Deposit Schedule 

You would be a monthly schedule depositor for a calendar year if the total tax reported for your lookback period was $50,000 or less. Under the monthly deposit schedule, deposit accumulated taxes on payments made during a calendar month by the 15th day of the following month. New employers - your tax liability for any quarter in the lookback period before the date you started or acquired your business is considered to be zero. Therefore, you're a monthly schedule depositor for the first calendar year of your business. However, see the $100,000 Next-Day Deposit Rule later. 

941 Semiweekly Deposit Schedule 

You would be a semiweekly schedule depositor for a calendar year if the total taxes during your lookback period were more than $50,000. 

Deposit Period (Payment Days) Deposit By 

Wednesday, Thursday, and/or Friday Following Wednesday

Saturday, Sunday, Monday, and/or Tuesday Following Friday

$100,000 Next-Day Deposit Rule 

Suppose you accumulate a tax liability of $100,000 or more on any day during a deposit period. In that case, you must deposit the tax by the close of the next business day, whether you're a monthly or semiweekly scheduled depositor.

Suppose you're a monthly schedule depositor and accumulate a $100,000 tax liability on any day. In that case, you become a semiweekly schedule depositor on the next day and remain so for at least the rest of the calendar year and for the following calendar year.

Deposit Rules For Annual Forms 943, 944, 945, and CT-1 

Generally, the deposit rules for quarterly filers of Form 941 also apply to annual filers of Form 943, Employer's Annual Federal Tax Return for Agricultural Employees; Form 944, Employer's ANNUAL Federal Tax Return; Form 945, Annual Return of Withheld Federal Income Tax; and Form CT-1, Employer's Annual Railroad Retirement Tax Return. However, the period used as your lookback period is different.

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). 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.

Depositing On Time

For EFTPS deposits to be on time, you must submit the deposit by 8 p.m. Eastern Standard Time, the day before the date the deposit is due. If you fail to submit an EFTPS deposit on time, you may use the same-day wire payment option discussed above.

The Lookback Period For Form 941. 

Your deposit schedule for a calendar year is determined from the total taxes reported on your Form 941 in a 4-quarter lookback period. The lookback period begins July 1 and ends June 30. If you reported $50,000 or less of Form 941 taxes for the lookback period, you're a monthly schedule depositor; if you reported more than $50,000, you're a semiweekly schedule depositor. The lookback period for a 2022 Form 941 filer who filed Form 944 in either 2021 or 2022 is the calendar year 2021. 

The Lookback Period For Annual Returns 

The lookback period is the calendar year preceding the previous year for annual returns (Forms 943, 944, 945, and CT-1). For example, the lookback period for 2023 is 2021.

Accuracy of Deposits Rule 

You must deposit 100% of your tax liability on or before the deposit due date. However, penalties won't be applied for depositing less than 100% if both of the following conditions are met. 

  1. Any deposit shortfall doesn't exceed the greater of $100 or 2% of the amount of taxes otherwise required to be deposited. 
  2. The deposit shortfall is paid or deposited by the shortfall makeup date as described below.

Makeup Date for Deposit Shortfall 

Monthly Schedule Depositor 

Deposit or pay the shortfall with your return by the due date of the return. You may pay the shortfall with your return, even if the amount is $2,500 or more. 

Semiweekly schedule depositor 

Deposit by the earlier of: 

1. The first Wednesday or Friday that falls on or after the 15th of the month following the month in which the shortfall occurred. 

2. The due date of your return (for the return period of the tax liability). Forms 941, 943, 944, and 945 are due by the last day of the month following the period for which the returns were made. Form CT-1 is due by the last day of the second month following the calendar year.

 





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