Page 33 - IRS Employer Tax Guide

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The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.
on your Form 941 or Form 944. Otherwise, report so- duced from 0.5% per month to 0.25% per month if an in-
cial security and Medicare taxes and income tax with- stallment agreement is in effect. You must have filed your
holding for household employees on Schedule H return on or before the due date of the return to qualify for
(Form 1040 or 1040-SR). See Pub. 926 for more infor- the reduced penalty. The maximum amount of the FTP
mation. penalty is also 25% of the tax due. If both penalties apply

• Employers reporting wages for employees in in any month, the FTF penalty is reduced by the amount of
American Samoa, Guam, the Commonwealth of the FTP penalty. The penalties won't be charged if you
the Northern Mariana Islands, the U.S. Virgin Is- have a reasonable cause for failing to file or pay. If you re-
lands, or Puerto Rico. If your employees aren't sub- ceive a penalty notice, you can provide an explanation of
ject to U.S. income tax withholding, use Forms why you believe reasonable cause exists.
941-SS, 944, or Formulario 944(SP). Employers in Pu- Note. In addition to any penalties, interest accrues
erto Rico use Formularios 941-PR, 944(SP), or Form from the due date of the tax on any unpaid balance.
944. If you have both employees who are subject to If income, social security, or Medicare taxes that must
U.S. income tax withholding and employees who be withheld aren't withheld or aren't paid, you may be per-
aren't subject to U.S. income tax withholding, you sonally liable for the trust fund recovery penalty. See Trust
must file only Form 941 (or Form 944 or Formulario fund recovery penalty in section 11.
944(SP)) and include all of your employees' wages on Generally, the use of a third-party payer, such as a PSP
that form. For more information, see Pub. 80, Federal or reporting agent, doesn't relieve an employer of the re-
Tax Guide for Employers in U.S. Virgin Islands, Guam, sponsibility to ensure tax returns are filed and all taxes are
American Samoa, and the Commonwealth of the paid or deposited correctly and on time. However, see
Northern Mariana Islands, or Pub. 179, Guía Contribu- Certified professional employer organization (CPEO),
tiva Federal para Patronos Puertorriqueños. later, for an exception.
• Agricultural employers reporting social security,
Medicare, and withheld income taxes. Report Don't file more than one Form 941 per quarter or
these taxes on Form 943. For more information, see more than one Form 944 per year. Employers with
Pub. 51. multiple locations or divisions must file only one Form 941
per quarter or one Form 944 per year. Filing more than
E-file. The IRS e-file program allows a taxpayer to elec- one return may result in processing delays and may re-
tronically file Form 941 or Form 944 using a computer with quire correspondence between you and the IRS. For infor-
an Internet connection and commercial tax preparation mation on making adjustments to previously filed returns,
software. For more information, go to IRS.gov/ see section 13.
EmploymentEfile, or call 866-255-0654.
Reminders about filing.
Electronic filing by reporting agents. Reporting • Don't report more than 1 calendar quarter on a Form
agents filing Form 940, 941, or 944 for groups of taxpay- 941.
ers can file them electronically. For details, see Pub.
3112, IRS e-file Application and Participation. For informa- • If you need Form 941 or Form 944, go to IRS.gov/
tion on electronic filing of Forms 940, 941, and 944, see Forms. Also see Ordering Employer Tax Forms, In-
Revenue Procedure 2007-40, 2007-26 I.R.B. 1488, avail- structions, and Publications, earlier.
able at IRS.gov/irb/2007-26_IRB#RP-2007-40. For infor- • Enter your name and EIN on Form 941 or Form 944.
mation on the different types of third-party payer arrange- Be sure they’re exactly as they appeared on earlier re-
ments, see section 16. turns.

Electronic filing by CPEOs. With the exception of the • See the Instructions for Form 941 or the Instructions
first quarter for which a CPEO is certified, CPEOs are re- for Form 944 for information on preparing the form.
quired to electronically file Form 941. Under certain cir-
cumstances, the IRS may waive the electronic filing re- Final return. If you go out of business, you must file a fi-
quirement. To request a waiver, the CPEO must file a nal return for the last quarter (last year for Form 944) in
written request using the IRS Online Registration System which wages are paid. If you continue to pay wages or
for Professional Employer Organizations at least 45 days other compensation for periods following termination of
before the due date of the return for which the CPEO is your business, you must file returns for those periods. See
unable to electronically file. For more information on filing the Instructions for Form 941 or the Instructions for Form
a waiver request electronically, go to IRS.gov/CPEO. 944 for details on how to file a final return.
If you’re required to file a final return, you’re also re-
Penalties. For each whole or part month a return isn't quired to furnish Forms W-2 to your employees and file
filed when required, there is a failure-to-file (FTF) penalty Forms W-2 and W-3 with the SSA by the due date of your
of 5% of the unpaid tax due with that return. The maximum final return. Don't send an original or copy of your Form
penalty is generally 25% of the tax due. Also, for each 941 or Form 944 to the SSA. See the General Instructions
whole or part month the tax is paid late, there is a fail- for Forms W-2 and W-3 for more information.
ure-to-pay (FTP) penalty of 0.5% per month of the amount
of tax. For individual filers only, the FTP penalty is re-

Page 32 Publication 15 (2020)