Purpose of form.   Use Form 941-M to report monthly: (a) federal income tax you withheld from wages, tips, distributions from nonqualified pension plans (including nongovernmental section 457(b) plans), supplemental unemployment compen- sation benefits, and third-party payments of sick pay; and (b) social security and Medicare taxes. If you report just one kind of tax, fill in only the lines that apply.

  

Form 941-M is not for general public use and should only be filed directly with an IRS compliance representative.

Who must file.   File Form 941-M if you must report federal income taxes withheld, social security taxes, and Medicare taxes on a monthly basis with an IRS compliance representative. The IRS may require monthly returns on Form 941-M and payments of tax from any employer who has not complied with the requirements for the filing of returns or the paying or depositing of taxes reported on quarterly or annual returns. Do not file monthly returns unless you received written notification from the IRS to do so. A preaddressed return envelope and blank Form 941-M will be mailed to you before your first monthly return is due and for each month thereafter. If you no longer expect to pay amounts subject to tax reportable on Form 941-M, check the box on line 16 and enter the date you last paid wages.

When to file.   Form 941-M for any month is due by the 15th day of the following month. If the due date for filing a return falls on a Saturday, Sunday, or legal holiday, you may file the return on the next business day.

Where to file.   File Form 941-M, with any payment due, using the preaddressed envelope furnished to you. Keep a duplicate Form 941-M for your records.

Form W-5.   Each eligible employee wishing to receive any advance earned income credit (EIC) payments must give you a completed Form W-5, Earned Income Credit Advance Payment Certificate. Your requirement to notify certain employees about the EIC can be met by giving each eligible employee Notice 797, Possible Federal Tax Refund Due to the Earned Income Credit (EIC). See section 10 of Pub. 15 (Circular E) and Pub. 596, Earned Income Credit (EIC), for more information.

Form W-2.   By January 31, furnish Forms W-2 to employees who worked for you during the previous year. If an employee stops working for you before the end of the year, furnish Form W-2 to the employee any time after employment ends but no later than January 31 of the following year. However, if the employee asks you for Form W-2, furnish the completed form within 30 days after the request or the final wage payment, whichever is later. Send Copy A of all Forms W-2, Wage and Tax Statement, issued for the year with a Form W-3, Transmittal of Wage and Tax Statements, filed on paper, to the Social Security Administration (SSA) by the last day of February. If you file Forms W-2 electronically, file them with SSA by the last day of March.

  

If you file a final return on Form 941-M, you must furnish Form W-2 to your employees by the last day of the month in which the final Form 941-M is due. File Copy A of Forms W-2 and Form W-3 with the Social Security Administration by the last day of the month following the month your final Form 941-M was due. See the Instructions for Forms W-2 and W-3 for details

Penalties and interest.   There are penalties for filing a return late and paying or depositing taxes late, unless there is reasonable cause. There are also penalties for failure to: (a) furnish Forms W-2 to employees and file copies with the SSA and (b) deposit taxes when required. (Do not attach an explanation of why the return is late to Forms W-2 sent to the SSA.) In addition, there are penalties for willful failure to file returns and pay taxes when due and for filing false returns or submitting bad checks. Interest is charged on taxes paid late at the rate set by law. See Pub. 15 (Circular E) for additional information.

  

A trust fund recovery penalty may apply if federal income, social security, and Medicare taxes that must be withheld are not withheld or are not paid. This penalty is the full amount of any unpaid trust fund tax. This penalty may apply to you if these unpaid taxes cannot be immediately collected from the employer or business. The trust fund recovery penalty may be imposed on all persons who are determined by the IRS to be responsible for collecting, accounting for, and paying over these taxes, and who acted willfully in not doing so.

  A responsible person can be an officer or employee of a corporation, a partner or employee of a partnership, an accountant, a volunteer director/trustee, or any employee of a sole proprietorship. A responsible person also may include one who signs checks for the business or otherwise has authority to cause the spending of business funds. Willfully means voluntarily, consciously, and intentionally.

Related publications.    Pub. 15 (Circular E) explains the rules for withholding, paying, depositing, and reporting federal income tax, social security and Medicare taxes, and federal unemployment (FUTA) tax on wages. See Pub. 15-A, Employer's Supplemental Tax Guide, for information on sick pay paid by third-party payers. Pub. 51 (Circular A), Agricultural Employer's Tax Guide, explains rules for employers of farmworkers. These publications are available by calling 1-800-TAX-FORM (1-800-829-3676). See Pub. 15 (Circular E) for additional methods of obtaining forms and publications.

Reconciliation of Forms 941-M and W-3.    Certain amounts reported on the monthly Forms 941-M for the year should agree with the Form W-2 totals reported on Form W-3. The amounts that should agree are: federal income tax withholding, social security wages, social security tips, Medicare wages and tips, and the advance earned income credit (EIC).

  If the totals do not agree, the IRS may require you to explain the differences and correct any errors. See section 12 of
Pub. 15 (Circular E) for details.