The Complete Small Business Guide to IRS Form 941

Small business owner manually filing Form 941
Manually Filing Form 941 Can be Tricky

The third quarter filing deadline for Form 941 is fast approaching! If you don’t have a full-service payroll solution for your small business like PayWow, manually filing Form 941 can be tricky but it need-not be difficult. We’re sharing a complete small business guide to IRS Form 941 to help during this tax season!


The Complete Small Business Guide to IRS Form 941

What is Form 941?

Form 941, the Employer’s Quarterly Tax Return, is used to report employment taxes. If you pay wages for employment, you will need to file IRS Form 941 quarterly. You, the employer, are responsible for withholding and reporting social security tax, income taxes, and Medicare tax from employee wages. Form 941 is also used to calculate your portion of social security and Medicare tax.


Fourth Quarter Form 941 Deadline: January 31st


Do I Need to File IRS Form 941?

All businesses that pay wages for employment are required to file Form 941 and continue to do so even if there are no employees present during select quarters. Seasonal and agricultural employers are the only exception and are not required to file for each quarter.


What Do I Need to File Form 941?

To file Form 941, you will need your business details such as your EIN and preferably an Online Signature PIN. You do not necessarily need a PIN to file, however, if you choose to file online it will make the process simpler. If you do not have a PIN, you will need to complete and e-sign Form 8453-EMP.

In addition to your business information, you need these three pieces of payroll information in order to file Form 941.

  • Number of Employees
  • Total Paid Wages
  • IRS Tax Amount Withheld


What are the Penalties Associated with Form 941?

Small business owner filing Form 941 onlineFailure-To-File tax penalties for Form 941 result in a 5% penalty based on the total tax amount due. Your business is then charged an additional 5% each month the return remains unpaid, for up to five months.

You’ll be penalized for depositing tax payments late. Initially, you will be penalized .5% of the unpaid tax amount and will be charged each month following the deadline. The penalty amount will increase to 1% of the tax amount ten days following notification that the IRS intends to levy. This notice should be taken seriously and is a final warning that the IRS is prepared to seize your property to satisfy the unpaid debt.

Warning: The IRS can garnish your wages, withdraw money from your bank accounts or possess other personal property to settle the owed debt. However, the tax penalty will be capped at 25% of the total unpaid tax.


E-File Your Form 941 Today

IRS penalties are completely avoidable when you plan ahead and know where to go to efficiently e-file your 941 Forms. Our sister product, TaxBandits, is an IRS authorized comprehensive solution for generating e-filing in the simplest way possible.

PayWow and TaxBandits understand that payroll tax information and IRS terminology can be confusing especially under pressure. We pride ourselves on being IRS-authorized to provide you with a safe, secure and accurate e-filing process that will save you both time and money. Contact the TaxBandits team today Monday through Friday 9AM to 6PM at (704) 684-4751 or 24/7 via email at


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