This is archived information that pertains only to the 2006 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.
Purpose of Schedule B (Form 941)
These instructions tell you about Schedule B (Form 941), Report of Tax Liability for Semiweekly Schedule Depositors. To determine
if you are a
semiweekly depositor, visit the IRS website at
www.irs.gov and type “semiweekly depositor” in the search box. Also see Pub. 15 (Circular E),
Employer's Tax Guide, or Pub. 80 (Circular SS), Federal Tax Guide for Employers in the U.S. Virgin Islands, Guam, American
Samoa, and the Commonwealth
of the Northern Mariana Islands.
What Is Schedule B (Form 941)?
Federal law requires you, as an employer, to withhold taxes from your employees' paychecks. Each time you pay wages, you
must withhold - or
take out of your employees' paychecks - certain amounts for federal income tax, social security tax, and Medicare tax (payroll
taxes). Under
the withholding system, taxes withheld from your employees are credited to your employees in payment of their tax liabilities.
Federal law also requires employers to pay any liability for the employer's portion of social security and Medicare taxes.
This portion of social
security and Medicare taxes is not withheld from employees.
Schedule B (Form 941) accompanies Form 941, Employer's QUARTERLY Federal Tax Return, or Form 941-SS, Employer's QUARTERLY
Federal Tax Return
(American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands), that you use to report
your payroll taxes and
adjustments. (Do not use Schedule B (Form 941) as an attachment to Form 944, Employer's ANNUAL Federal Tax Return, or Form
944-SS, Employer's ANNUAL
Federal Tax Return. Instead use Form 945-A, Annual Record of Federal Tax Liability.)
On Schedule B (Form 941), list your tax liability for each day.
Include:
Note. Subtract any advance earned income credit payments from your tax liability.
Do not use the Schedule B (Form 941) to show federal tax deposits. Deposit information is taken from your deposit coupons (Form
8109,
Federal Tax Deposit Coupon) or from the Electronic Federal Tax Payment System (EFTPS).
IRS uses Schedule B (Form 941) to determine if you have deposited your federal employment tax liabilities on time. If you
do not properly complete
and file your Schedule B (Form 941) with Form 941 or Form 941-SS, IRS may propose an “averaged” failure-to-deposit penalty. See Deposit
Penalties in section 11 of Pub. 15 (Circular E) for more information.
Who Must file Schedule B (Form 941)?
File Schedule B (Form 941) if you are:
-
a semiweekly schedule depositor or
-
a monthly schedule depositor who accumulated a tax liability of $100,000 or more on any given day in the reporting period.
See $100,000
Next-Day Deposit Rule in section 11 of
Pub. 15 (Circular E) for important details.
Do not complete Schedule B (Form 941) if you have a tax liability that is less than $2,500 (after you subtract any advance
earned income credit
(EIC) payment) during the quarter and you pay in full with a return that you file on time.
Attach your Schedule B (Form 941) to your Form 941 or Form 941-SS and file it every quarter when that Form 941 or Form 941-SS
is due. For more
information, see section 12 of Pub. 15 (Circular E), the Instructions for Form 941, or the Instructions for Form 941-SS.