Instructions For Form 941-M - Employer'S Monthly Federal Tax Return - 2005

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Department of the Treasury
Instructions for Form 941-M
Internal Revenue Service
(Rev. March 2005)
Employer’s Monthly Federal Tax Return
Section references are to the Internal Revenue Code unless otherwise indicated.
Form W-2. By January 31, furnish Forms W-2 to employees
What’s New
who worked for you during the previous year. If an employee
stops working for you before the end of the year, furnish Form
Revised form and instructions. We revised Form 941-M and
W-2 to the employee any time after employment ends but no
the Instructions for Form 941-M to conform with the redesign of
later than January 31 of the following year. However, if the
Form 941 and the Instructions for Form 941.
employee asks you for Form W-2, furnish the completed form
Social security wage base for 2005. Stop withholding social
within 30 days after the request or the final wage payment,
security tax after an employee reaches $90,000 in taxable
whichever is later. Send Copy A of all Forms W-2, Wage and
Tax Statement, issued for the year with a Form W-3,
wages. (There is no limit on the amount of wages subject to
Medicare tax.)
Transmittal of Wage and Tax Statements, filed on paper, or
reports filed on magnetic diskette, to the Social Security
Administration (SSA) by the last day of February. If you file
Forms W-2 electronically (not by magnetic diskette) file them
General Instructions
with SSA by the last day of March.
Purpose of form. Use Form 941-M to report monthly: (a)
If you file a final return on Form 941-M, you are also
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income tax you withheld from wages, tips, distributions from
required to furnish Form W-2 to your employees by the
nonqualified pension plans (including nongovernmental
last day of the month in which the final Form 941-M is
CAUTION
section 457(b) plans), supplemental unemployment
due. File Copy A of Forms W-2 and Form W-3 with the Social
compensation benefits, and third-party payments of sick pay;
Security Administration by the last day of the month following
and (b) social security and Medicare taxes. If you report just
the month your final Form 941-M was due. See the Instructions
one kind of tax, fill in only the lines that apply.
for Forms W-2 and W-3 for details
Penalties and interest. There are penalties for filing a return
This form is not for general public use and should only
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late and paying or depositing taxes late, unless there is
be filed directly with an IRS compliance representative.
reasonable cause. If you file or pay late, attach an explanation
CAUTION
to your return. There are also penalties for failure to: (a) furnish
Who must file. File Form 941-M if you are required to report
Forms W-2 to employees and file copies with the SSA and (b)
income taxes withheld, social security taxes, and Medicare
deposit taxes when required. (Do not attach an explanation of
taxes on a monthly basis by an IRS compliance representative.
why the return is late to Forms W-2 sent to the SSA.) In
The IRS may require monthly returns on this form and
addition, there are penalties for willful failure to file returns and
payments of tax from any employer who has not complied with
pay taxes when due and for filing false returns or submitting
the requirements for the filing of returns or the paying or
bad checks. Interest is charged on taxes paid late at the rate
depositing of taxes reported on quarterly returns. Do not file
set by law. See Pub. 15 (Circular E) for additional information.
monthly returns unless you received written notification from the
A trust fund recovery penalty may apply if income, social
IRS to do so. A preaddressed return envelope and blank Form
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security, and Medicare taxes that must be withheld are
941-M will be mailed to you before your first monthly return is
not withheld or are not paid. This penalty is the full
due and for each month thereafter. If you no longer expect to
CAUTION
amount of any unpaid trust fund tax. This penalty may apply to
pay amounts subject to tax reportable on Form 941-M, check
you if these unpaid taxes cannot be immediately collected from
the box on line 16 and enter the date that you last paid wages.
the employer or business. The trust fund recovery penalty may
When to file. Form 941-M for any month is due by the 15th
be imposed on all persons who are determined by the IRS to be
day of the following month. If the due date for filing a return falls
responsible for collecting, accounting for, and paying over these
on a Saturday, Sunday, or legal holiday, you may file the return
taxes, and who acted willfully in not doing so.
on the next business day.
A responsible person can be an officer or employee of a
Where to file. File Form 941-M, with any payment due, using
corporation, a partner or employee of a partnership, an
the preaddressed envelope furnished to you. Keep a
accountant, a volunteer director/trustee, or any employee of a
duplicate Form 941-M for your records.
sole proprietorship. A responsible person also may include one
who signs checks for the business or otherwise has authority to
Forms W-4. You are required to send to the IRS copies of any
cause the spending of business funds. Willfully means
Forms W-4 received during the month from employees still
voluntary, consciously, and intentionally.
employed by you at the end of the month claiming: (a) more
than 10 withholding allowances or (b) exemption from income
Related publications. Pub. 15 (Circular E) explains the rules
tax withholding if their wages are expected to exceed $200 a
for withholding, paying, depositing, and reporting federal
week. For details, see section 9 of Pub. 15 (Circular E),
income tax, social security and Medicare taxes, and federal
Employer’s Tax Guide. Do not send any Forms W-4P or W-4S
unemployment (FUTA) tax on wages. See Pub. 15-A,
to the IRS.
Employer’s Supplemental Tax Guide, for information on sick
pay paid by third-party payers. Pub. 51 (Circular A), Agricultural
Form W-5. Each eligible employee wishing to receive any
Employer’s Tax Guide, explains rules for employers of
advance earned income credit (EIC) payments must give you a
farmworkers. These publications are available by calling
completed Form W-5, Earned Income Credit Advance Payment
1-800-TAX-FORM (1-800-829-3676). See Pub. 15 (Circular E)
Certificate. The employer’s requirement to notify certain
for additional methods of obtaining forms and publications.
employees about the EIC can be met by giving each eligible
employee Notice 797, Possible Federal Tax Refund Due to the
Reconciliation of Forms 941-M and W-3. Certain amounts
Earned Income Credit (EIC). See section 10 of Pub. 15
reported on the monthly Forms 941-M for the year should agree
(Circular E) and Pub. 596, Earned Income Credit (EIC), for
with the Form W-2 totals reported on Form W-3. The amounts
more information.
that should agree are: income tax withholding, social security
Cat. No. 39535W

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