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

Do not adjust income tax withholding for quarters in

required to deposit. See section 11 of Pub. 15 (Circular E)

previous years unless you do it to correct an

for information and rules about federal tax deposits.

•

administrative error. An administrative error

If line 10 is $2,500 or more for the quarter, you must

CAUTION

happened if the amount you entered on Form 941 was not

deposit your tax liabilities by using the Electronic Federal

the same amount you actually withheld. For example, when

Tax Payment System (EFTPS) or at an authorized financial

the total amount of income tax actually withheld was not

institution with Form 8109. The amount shown on line 10

reported correctly on Form 941 because of a mathematical

must equal the “Total” shown on Form 941, line 15 or the

or transposition error, the difference is an administrative

“Total liability for the quarter” shown on Schedule B

error. The administrative error adjustment corrects the

(Form 941).

amounts reported on the Form 941 to agree with the amount

If you are a semiweekly depositor, you must

actually withheld from the employee. Remember to attach

complete Schedule B (Form 941). If you fail to

an explanation for the adjustment.

complete and submit Schedule B (Form 941), IRS

CAUTION

7e. Prior quarters’ social security and Medicare

will assert deposit penalties based on available information.

taxes. Enter adjustments for prior quarters’ social security

11. Total Deposits for This Quarter

and Medicare taxes. For example, if you made a mistake

when reporting social security and Medicare taxes on

Enter your deposits for this quarter, including any deposits

previously filed Forms 941, adjust it here. If you need to

that you were required to make to cover prior period

report both an underpayment and an overpayment, show

liabilities resulting from adjustments shown on line 7. Also

only the net difference.

include in the amount shown any overpayment from a

previous period that you applied to this return.

If you are adjusting an employee’s social security or

TIP

Medicare wages or tips for a prior year, you must

12. Balance Due

also file Form W-2c, Corrected Wage and Tax

Statement, and Form W-3c, Transmittal of Corrected Wage

You do not have to pay if line 12 is under $1. Generally,

and Tax Statements.

you should have a balance due only if your total taxes after

adjustment for advance EIC for the quarter (line 10) are less

7f. Special additions to federal income tax. This line

than $2,500. (However, see section 11 of Pub. 15

is reserved for employers with special circumstances. Use

(Circular E) for information about payments made under the

this line only if the IRS has sent you a notice instructing you

accuracy of deposits rule.)

to do so.

7g. Special additions to social security and

You may pay the amount shown on line 12 using EFTPS.

Medicare. This line is reserved for employers with special

If you do so, file your return using the “Without a payment”

circumstances. Use this line only if the IRS has sent you a

address on page 4 under Where should you file? and do

notice instructing you to do so.

not file Form 941-V, Payment Voucher.

7h. Total adjustments. Combine all adjustments

If line 10 is $2,500 or more and you have deposited all

shown on lines 7a through 7g and enter the result here.

taxes when due, line 12 (“Balance due”) should be zero.

Total Taxes After Adjustments

line10

− line11

Combine the amounts shown on lines 6 and 7h and enter

the result here.

line12

9. Advance Earned Income Credit (EIC)

If you do not deposit as required and, instead, pay

Payments Made to Employees

the taxes with Form 941, you may be subject to a

penalty.

CAUTION

Enter the amount of the advance earned income credit (EIC)

payments that you made to your employees. Eligible

13. Overpayment

employees may choose to receive part of the EIC as an

advance payment. Those who expect to have a qualifying

If line 11 is more than line 10, write the amount in line 13.

child must give you a completed Form W-5 stating they

Never make an entry in both lines 12 and 13.

expect to qualify for the EIC. Once the employee gives you

If you deposited more than the correct amount for a

a signed and completed Form W-5 you must make the

quarter, you can choose to have us either refund the

advance EIC payments starting with the employee’s next

overpayment or apply it to your next return. Check the

wage payment. Advance EIC payments are generally made

appropriate box in line 13. If you do not check either box, we

from withheld income tax and employee and employer social

will automatically refund the overpayment. We may apply

security and Medicare taxes. See section 10 of Pub. 15

your overpayment to any past due tax account that is shown

(Circular E) and Pub. 596, Earned Income Credit.

in our records under your EIN.

If the amount of your advance EIC payments is more

If line 13 is under $1, we will send a refund or apply it to

than your total taxes after adjustments (line 8) for the

your next return only if you ask us in writing to do so.

quarter, you may claim a refund of the overpayment or elect

to have the credit applied to your return for the next quarter.

Attach a statement to your Form 941 identifying the amount

Part 2: Tell us about your deposit

of excess payments and the pay periods in which you paid

schedule for this quarter

it.

10. Total Taxes After Adjustment for

Advance EIC

14. State abbreviation

Calculate your total taxes as shown below.

In the spaces provided, write the two-digit Postal Service

abbreviation for the state where you deposit your taxes

line 8

using Form 8109 or initiate EFTPS transfers. IRS uses the

−

line 9

state shown to determine banking days for purposes of

line 10

deposit due dates. Official state holidays for the state shown

•

If line 10 is less than $2,500, you may pay the full

are not counted as banking days. If you deposit in multiple

amount with a timely filed return because you were not

states, enter “MU” in the spaces provided.

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Instructions For Form 941 - Employer'S Quarterly Federal Tax Return - 2005 Page 6

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