941 Form Instructions

Form 941, Employer’s Quarterly Tax Return, is one of the most challenging tax forms for business owners at first, but once you get the hang of it, you’ll realize that it’s so easy to file it on your own. It’s not filling out Form 941 that takes the majority of the employer’s time – it’s the information gathering part. Since you’ll report every tax withheld from every employee’s income, you have to do lots of adding. 

For example, you won’t file a 941 for every employee. You’ll file it for every employee that works for you and calculate your portion of the Social Security taxes. That said, you have to gather the information prior to filling out Form 941 to have an easier time. In this article, we’ll give you the instructions to file 941 Form 2024 and explain the content of the form while answering commonly asked questions.

Take note that you must fill out all three pages of Form 941. Start filling out Form 941 for the 2023 quarters.

Part 1 of Form 941

The first section of Form 941 is the most comprehensive part as you’ll need to detail every type of tax withheld from your employees’ wages. Here are the line-by-line instructions to file Form 941.

Line 1. Enter the total number of employees working for you as stated.

Line 2. Enter the total amount paid to employees, including wages, tips, and other compensation.

Line 3. Enter the federal income taxes withheld from the above income.

Line 4. Check the box if the income paid to employees is not subject to Social Security and Medicare taxes.

Line 5. Enter the Social Security and Medicare taxes withheld along with the employees’ income subject to these taxes.

Line 6. In the rest of Form 941, you’ll make adjustments. Enter the total taxes before adjustments on in this line.

Line 7. Enter the adjustments for fractions of cents for the quarter you’re filing. In other words, enter the rounding difference related to the employee portions of Social Security and Medicare taxes. 

Line 8. Enter the adjustments for sick pay for the current quarter. 

Line 9. Enter the adjustments for tips and group-term life insurance for the quarter.

Line 10. Enter the total taxes after the adjustments on Lines 7 through 9.

Line 11. From Line 11a to 11g, enter the following.

• a. Enter the qualified small business payroll tax credits for the increasing research activities. If you enter an amount here, you must attach Form 8974.
• b. Enter the non-refundable share of the above credit for qualified sick and family leave wages for leave taken before the second quarter.
• c. Enter the non-refundable part of employee retention credit.
• d. Enter the non-refundable share of the credit for qualified sick and family leave wages for the leave after the first quarter.
• e. Enter the non-refundable portion of COBRA premium assistance credit.
• f. Enter the number of employees covered by the COBRA premium assistance.
• Enter the total non-refundable tax credits. For this, enter Lines 11a through 11e.

Line 12. Enter the total taxes after the adjustments and non-refundable credits.

Line 13. From Line 13a to 13i, enter the following.

• a. Enter the total deposits for the current quarter. This includes the overpayment applied from a prior quarter and overpayments applied from other Forms 941.
• b. Enter the deposits reserved for the future.
• c. Enter the refundable share of the credit for qualified sick and family leave wages for the leaves taken before the second quarter.
• d. Enter the refundable portion of employee retention credit.
• e. Enter the refundable share of the credit for qualified sick and family leave wages after the first quarter. 
• f. Enter the refundable share of the COBRA premium assistance credit.
• g. Enter the total deposits and refundable credits. For this, enter Lines 13a through 13f.
• h. Enter the total advances received from filing Forms 7200 for the current quarter.
• i. Enter the total deposits and refundable credits less advances. For this, subtract Line 13h from 13g.

Line 14. Enter your balance due. Get this amount if Line 12 is more than Line 13i, enter the difference here.

Line 15. Enter the overpayment amount. Get this amount if Line 13i is more than Line 12, enter the difference.

Part 2 of Form 941

Provide the IRS with your deposit schedule and tax liability for the current quarter, on a monthly basis.

Part 3 of Form 941

In this part of Form 941, you need to answer questions about your business that applies. If a question doesn’t apply to your business, you can leave it blank. Most of the questions include the total income paid to employees that qualify for certain credits. 

Part 4 of Form 941

If you’re a tax preparer or an employee that’s filling out the 941, enter your personal information and the 5-digit personal identification number. If you’re an employer that’s filling out the 941, check “no”.

Do I need to file Form 941 for every quarter?

Yes, Form 941 is filed for every quarter. When you skip on filing a quarter’s 941, you’ll pay 5 percent of the unpaid tax amount in penalties, for every month the 941 is late with a maximum penalty of 25 percent. 

Can I e-file Form 941?

The IRS accepts electronically filed Forms 941. If you’re looking for the convenience of filing Form 941 on your computer, you can also fill it out online, on your computer and print out a paper copy to mail to the Internal Revenue Service. Surely, it’s not exactly like e-filing as you’ll submit the form to the IRS by mail, it’s still a lot better than filling it out on paper.

How to select the quarter on Form 941?

Select the quarter you’re filing 941 for on the top right corner of the form on the first page. You can also see which year the 941 was produced for outlined in black at the same spot.