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

Adjustments you report here change your tax liability and

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

your tax deposits. You will have to take these adjustments

advance EIC payments starting with the employee’s next

into account on line 15 as Tax liability: Month 1; Month 2;

wage payment. Advance EIC payments are generally made

Month 3 or on Schedule B (Form 941). You must explain

from withheld federal income tax and employee and

any prior period adjustments that you make on

employer social security and Medicare taxes.

Form 941c or in an equivalent statement.

If the amount of your advance EIC payments is more

Form 941c is not an amended return but is a statement

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

providing the necessary information and certifications for

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

adjustments shown on lines 7d through 7g. Do not file

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

Form 941c separately from Form 941. See section 13 of

Attach a statement to Form 941 identifying the amount of

Pub. 15 (Circular E).

excess payments and the pay periods in which you paid it.

For more information on advance EIC, see section 10 of

For errors discovered after 2008, make corrections

Pub. 15 (Circular E) and Pub. 596, Earned Income Credit.

to a previously filed Form 941 on Form 941-X. Lines

7d, 7e, 7f, and 7g will be deleted from the 2009

CAUTION

10. Total Taxes After Adjustment for

Form 941.

Advance EIC

7d. Current year’s income tax withholding. Enter

Subtract line 9 from line 8.

adjustments for the current year’s federal income tax

•

withholding. For example, if you made a mistake when

Line 10 is less than $2,500. You may pay the amount

withholding federal income tax from wages that were paid in

with Form 941 or you may deposit the amount. To avoid a

earlier quarters of the same calendar year, adjust it here.

penalty, you must pay the amount in full with a timely filed

However, see the CAUTION below for adjustment of a prior

return or you must deposit the amount timely.

•

year’s “administrative error” also shown on line 7d.

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

amount by using EFTPS or at an authorized financial

You cannot adjust or claim a refund or credit for any

institution with Form 8109. The amount shown on line 10

overpayment of federal income tax that you withheld or

must equal the “Total liability for quarter” shown on

deducted from your employees in a previous year because

Form 941, line 15 or the “Total liability for the quarter” shown

employees use the amount shown on Form W-2 as a credit

on Schedule B (Form 941).

when they file their income tax returns.

For more information on federal tax deposits, see

Do not adjust federal income tax withholding for

Depositing Your Taxes on page 3 and section 11 of Pub. 15

quarters in previous years unless you do it to correct

(Circular E).

an administrative error. An administrative error

CAUTION

happened if the amount you entered on Form 941 was not

If you are a semiweekly depositor, you must

the same amount you actually withheld. For example, when

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

the total amount of federal income tax actually withheld was

complete and submit Schedule B (Form 941), IRS

CAUTION

not reported correctly on Form 941 because of a

will assert deposit penalties based on available information.

mathematical or transposition error, the difference is an

11. Total Deposits for This Quarter

administrative error. The administrative error adjustment

corrects the amounts reported on Form 941 to agree with

Enter your deposits for this quarter, including any deposits

the amount actually withheld from the employee. Remember

that you were required to make to cover prior period

to attach an explanation of the adjustment.

liabilities resulting from adjustments shown on line 7. Also

include in the amount shown any overpayment from a

7e. Prior quarters’ social security and Medicare

previous period that you applied to this return.

taxes. Enter adjustments for prior quarters’ social security

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

12. Balance Due

when reporting social security and Medicare taxes on

If line 10 is more than line 11, write the difference in line 12.

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

Otherwise, see Overpayment on page 7.

report both an underpayment and an overpayment, show

only the net difference.

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

Generally, you should have a balance due only if your total

If you are adjusting an employee’s social security

taxes after adjustment for advance EIC for the quarter

TIP

wages, social security tips, or Medicare wages and

(line 10) are less than $2,500. However, see section 11 of

tips for a prior year, you must also file Form W-2c,

Pub. 15 (Circular E) for information about payments made

Corrected Wage and Tax Statement, and Form W-3c,

under the accuracy of deposits rule.

Transmittal of Corrected Wage and Tax Statements.

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

7f and 7g. Special additions to federal income tax

a credit card, a check or money order, or electronic funds

and Special additions to social security and Medicare.

withdrawal (EFW). Do not use a credit card or EFW to pay

These lines are reserved for employers with special

taxes that were required to be deposited. For more

circumstances. Use these lines only if the IRS has sent you

information on paying your taxes with a credit card or EFW,

a notice instructing you to do so. You must attach Form

visit the IRS website at and click on the

941c explaining the tax increase.

electronic IRS link.

7h. TOTAL ADJUSTMENTS. Combine all adjustments

If you pay by EFTPS or credit card, file your return using

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

the Without a payment address on page 4 under Where

Total Taxes After Adjustments

Should You File? and do not file Form 941-V, Payment

Voucher.

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

the result here.

If you pay by check or money order, make it payable to

the United States Treasury. Enter your EIN, Form 941, and

9. Advance Earned Income Credit (EIC)

the tax period on your check or money order. Complete

Payments Made to Employees

Form 941-V and enclose with Form 941.

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

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

payments that you made to your employees. Eligible

taxes when due, the balance due on line 12 should be zero.

employees may choose to receive part of the EIC as an

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

advance payment. Those who expect to have a qualifying

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

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

penalty.

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

CAUTION

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Instructions For Form 941 - Employer'S Quarterly Federal Tax Return - 2008 Page 7

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