Employer's Quarterly Tax Return, 941

I answer a lot of questions surrounding the IRS form 941. This is the employer's quarterly tax return.

The 941 needs to be filed each quarter. It is due on the last day of the month following the quarter end. The due dates are April 30, July 31, October 31 and January 31.



Deposits for most companies are made each month for employees withholding and matching FICA. The 941 reconciles all deposits made during the quarter to what is owed.



Most companies fall into trouble when they stop making their deposits thinking that they can "catch up" next month. Once you fail to make one deposit, it becomes a snowball effect and you end up owing the IRS a lot more than just your regular deposits.



One way to avoid this is to hire a payroll tax company which will figure your paychecks for you, process the checks for distribution to your employees, make your deposits and file your 941. It is a good idea. It may cast you some extra coin, but it keeps you out of trouble with the IRS. Besides having them do your payroll gives you more time to spend in your business doing more important things that can move your business forward, like being able to do more sales.

If you end up owing for more than 3 quarters will land you with a Revenue Officer of the IRS. And that is a bad deal.

If you need help with resolving an IRS issue please call a firm who knows how to take care of you.

IRS Collections and Your Options for Appeal

Before you prepare a request for Appeals, you need to decide if Appeals is the place for you. Select the appropriate appeal procedure for specific instructions on preparing your request for Appeals. If you decide you want to present your dispute to Appeals, you will need to prepare a request for Appeals and mail it to the office that sent you the decision letter.




Collection Appeals Program (CAP)Collection Appeals Program (CAP) is generally quick and available for a broad range of collection actions. However, you can’t go to court if you disagree with the Appeals decision.


Collection Due Process (CDP)Collection Due Process (CDP) is available if you receive one of the following notices:Notice of Federal Tax Lien Filing and Your Right to a Hearing Under IRC 6320 (Lien Notice), a Final Notice - Notice of Intent to Levy and Notice of Your Right to A Hearing, a Notice of Jeopardy Levy and Right of Appeal, a Notice of Levy on Your State Tax Refund – Notice of Your Right to a Hearing (Levy Notices), and a Notice of Levy and Notice of Your Right to a Hearing. If you disagree with the Appeals decision, you may be able to take your case to court.


Offer in Compromise (OIC)An Offer in Compromise (OIC) is an agreement between the taxpayer and the government that settles a tax liability for payment of less than the full amount owed.


Trust Fund Recovery Penalty (TFRP)If you are a person responsible for withholding, accounting for, or depositing or paying specified taxes including non-resident alien (NRA) withholding and employment taxes, and willfully fail to do so, you can be held personally liable for a penalty equal to the full amount of the unpaid trust fund tax, plus interest. A responsible person for this purpose can be an owner or officer of a corporation, a partner, a sole proprietor, or an employee of any form of business. A trustee or agent with authority over the funds of the business can also be held responsible for the penalty.

There are many options that the taxpayer has to resolve their tax issues. This can all be very confusing and overwhelming. Think of calling a tax professional to help you out in this very hard time. The can give you advice and answer many of your questions.

That's not your money!

The IRS takes the civil trust fund very seriously. If you own a business, you know exactly what the civil trust fund is. When you pay employees, the IRS "trusts" you to collect their withholding and FICA taxes. At that point, you have to give that money to the IRS and file a form 941 to reconcile what you have paid the IRS.

What happens a lot of times is a business will get into a cash crunch and not pay their civil trust fund deposits to pay other bills instead. They think they can catch up with it the next month and when that doesn't happen, the next. Slowly they realize that they are now behind 3 months and have not filed their form 941. The IRS sees this as stealing. This is not unpaid taxes of the business; instead, it is other people's money that was intended to pay their own taxes, medicare and social security retirement. It must be paid back and in full. The IRS does not negotiate on this type of liability.

This potentially places a business in great jeopardy. By not paying and/or filing for 3 months, they have earned themselves a Revenue Officer, the highest level of collections enforcement the IRS has. It is the Revenue Officer's job to collect the civil trust fund money. They will levy a business to collect the money. They can levy bank accounts and accounts receivables. They can even shut down a business to collect the civil trust fund.

It does not have to be the end of the road for your business. There are ways of handling this situation with the IRS. You need professional representation to help you navigate through these kinds of rough waters. There is help if you want it!