Instructions For Form 941 - Employer'S Quarterly Federal Tax Return

Department of the Treasury

Instructions for Form 941

Internal Revenue Service

(Rev. January 2006)

Employer’s QUARTERLY Federal Tax Return

Section references are to the Internal Revenue Code unless otherwise indicated.

Where can you get telephone help? You can call the IRS

What’s New

toll free at 1-800-829-4933 on Monday through Friday from

7 a.m. to 10 p.m. local time (Alaska and Hawaii follow

Alternative signature method. Effective with returns filed

Pacific time) to order tax deposit coupons (Form 8109) and

after June 2005, corporate officers or duly authorized agents

for answers to your questions about completing Form 941,

may sign Form 941 by rubber stamp, mechanical device, or

tax deposit rules, or obtaining an employer identification

computer software program. For details and required

number (EIN).

documentation, see Rev. Proc. 2005-39. You can find Rev.

Photographs of missing children. The Internal Revenue

Proc. 2005-39 on page 82 of Internal Revenue Bulletin

Service is a proud partner with the National Center for

2005-28 at

Missing and Exploited Children. Photographs of missing

Annual employment tax filing for small employers. For

children selected by the Center may appear in instructions

calendar year 2006, certain small employers will be qualified

on pages that would otherwise be blank. You can help bring

to file Form 944, Employer’s ANNUAL Federal Tax Return,

these children home by looking at the photographs and

rather than Form 941, Employer’s QUARTERLY Federal

calling 1-800-THE-LOST (1-800-843-5678) if you recognize

Tax Return, to report their employment taxes. The IRS will

a child.

notify those who will qualify to file the form beginning in

February 2006. For more information, get the Instructions for

Form 944.

General Instructions:

Credit card payments. Beginning in 2006, employers can

Understanding Form 941

pay the balance due shown on Form 941 by credit card.

However, do not use a credit card to make federal tax

deposits. For more information on paying your taxes with a

Purpose of Form 941

credit card, visit the IRS website at and type

“e-pay” in the Search box.

These instructions give you some background information

Social security wage base for 2006. Do not withhold

about Form 941, Employer’s QUARTERLY Federal Tax

social security tax after an employee reaches $94,200 in

Return. They tell you who must file the form, how to fill it out

social security wages. (There is no limit on the amount of

line by line, and when and where to file it.

wages subject to Medicare tax.)

If you want more in-depth information about payroll tax

topics relating to Form 941, see Pub. 15 (Circular E),

Reminders

Employer’s Tax Guide, or visit the IRS website at

and type “Employment Tax” in the Search box.

Correcting Form 941. If you discover an error on a

Federal law requires you, as an employer, to withhold

previously filed Form 941, make the correction using Form

taxes from your employees’ paychecks. Each time you pay

941 for the quarter in which you discovered the error and

wages, you must withhold – or take out of your employees’

attach Form 941c, Supporting Statement to Correct

paychecks – certain amounts for federal income tax, social

Information. For example, in March 2006, you discover that

security tax, and Medicare tax. Under the withholding

you underreported $10,000 in social security and Medicare

system, taxes withheld from your employees are credited to

wages on your fourth quarter 2005 Form 941. Correct the

your employees in payment of their tax liabilities.

error by showing $1,530 (15.3% × $10,000) on line 7e of

Federal law also requires employers to pay any liability

your 2006 first quarter Form 941 and attaching a completed

for the employer’s portion of social security and Medicare

Form 941c. Be sure to include the $1,530 in any required

tax deposit.

taxes. This portion of social security and Medicare taxes is

not withheld from employees.

Electronic filing and payment. Now, more than ever

before, businesses can enjoy the benefits of filing and

Use Form 941 to report:

•

paying their federal taxes electronically. Whether you rely on

payroll taxes (withheld federal income tax and both

employee and employer shares of social security and

a tax professional or handle your own taxes, IRS offers you

Medicare taxes) for the quarter;

convenient programs to make filing and paying easier.

•

current quarter’s adjustments to social security and

Spend less time and worry on taxes and more time running

Medicare taxes for fractions of cents, sick pay, tips, and

your business. Use e-file and Electronic Federal Tax

group-term life insurance; and

Payment System (EFTPS) to your benefit.

•

For e-file, visit for additional information.

prior quarters’ adjustments to payroll taxes (attach Form

•

For EFTPS, visit or call EFTPS Customer

941c).

Service at 1-800-555-4477, 1-800-733-4829 (TDD), or

Do not use the Form 941 to report backup withholding or

1-800-244-4829 (Spanish).

income tax withholding on nonpayroll payments such as

pensions, annuities, and gambling winnings. Report these

941TeleFile discontinued. You are no longer able to file

types of withholding on Form 945, Annual Return of

your employment tax return by telephone using 941TeleFile.

Withheld Federal Income Tax.

The IRS encourages you to file your Form 941 using other

convenient and easy IRS e-file options. Please visit us at

Who Must File Form 941?

and click on the e-file logo located in the

lower-left corner. File your “Zero Wage” Forms 941 using

IRS e-file, if possible. See also When Must You File? on

If you are an employer, you must file a quarterly Form 941 to

page 2.

report:

Cat. No. 14625L

Instructions For Form 941 - Employer'S Quarterly Federal Tax Return - 2006

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