IRS Form 941: What Employers Need to Know in 2023

Any business that has employees needs to file a form 941.

It’s due to the IRS on a quarterly basis and is part of your responsibility to withhold and remit payroll taxes. You can file for free through the mail, online for a fee through an IRS approved software provider, or have it done for you by a tax services provider.

If you’ve got questions about how form 941 works, you’re in the right place. The 2023 version of the form can be downloaded here. 

We’ll break down what it is, how it’s changing in 2023, and everything else you need to know.

Table of contents

1. What is form 941?
2. What’s new in 2023 
3. When is it due?
4. What’s the easiest way to file?
5. Where to file form 941
6. Where do you mail form 941
7. What are the penalties for filing late?
8. Are there exceptions when you don’t have to file?
9. Get help filing form 941 

What is form 941?

Form 941 reports social security, income, and Medicare tax withholding to the IRS. 

To file, you or your tax accountant will need to gather the following information:

• Total wages paid to all employees
• Tips reported
• Federal income tax withheld 
• Social Security, and Medicare Tax withheld 
• Adjustments to tax liability due to sick pay or family leave

Important! This reporting form is separate from your responsibility to pay those taxes. Do that on a monthly or semi weekly basis via your tax accountant or through the EFTPS.

What’s new in 2023 for the 941 form?

In 2023, the IRS made a few important changes to form 941. 

• The maximum amount of wages subject to tax in a year, known as the wage base limit, for social security taxes is up from $147,000 in 2022 to $160,200 in 2023. Pay above this amount is not subject to social security tax.
• There is still no wage base limit for Medicare tax.
• Form 941 can now be used to claim the Small Business Payroll Tax Credit for Expanding Research Activities for up to $250,000 in tax credit.
• Social security and Medicare taxes now apply to household workers, such as maids or gardeners, who are paid $2600 or more in a year. Likewise for election workers paid over $2200. 

	Employee portion	Employer portion
Social Security	6.2%	6.2%
Medicare	1.45%	1.45%

 

The 2023 Social Security and Medicare tax rates haven’t changed. When you make your payments to the IRS, be sure to include both your and your employee’s portions.

What are the 2023 due dates?

You’ll need to file form 941 by the last day of the month at the end of each quarter. There are penalties for tardiness. To make sure you don’t miss any deadlines, here are the dates to put on your calendar: 

Period	Due Date
Q1: January, February, March	April 30
Q2: April, May, June	July 31
Q3: July, August, September	October 31
Q4: October, November, December	January 31

What is the easiest way to file?

If you have more than a handful of employees, the easiest way to file is to hire an accounting professional. It’ll save you the headache of doing it yourself, bring you peace of mind knowing that it’s done correctly, and even potentially pay for itself through tax savings and optimized financial strategies only an expert would be aware of. 

Would you like Indinero to make your life easier while optimizing your tax strategy and saving you money? Book a call with one of our experts.

Where to file form 941

You can file form 941 digitally or through the mail.

To file online, check out this list of IRS approved software solutions or visit the tax1099 website. 

The IRS doesn’t have a digital filing service of its own, and surprisingly, some popular tax software, such as TurboTax, won’t file your 941 either. While filing through the mail is free, there is no way to file for free online. This is why so many businesses turn to tax professionals like those at Indinero to file this important form.

Where to mail form 941?

To mail your form 941, download and print the 2023 edition here and refer to this list of state specific addresses to learn where to mail it: 

What are the penalties for filing late? 

As you’re likely aware, the IRS doesn’t mess around when it comes to due dates. They charge both flat fees as well as annual interest for late payments. Hiring an agent to handle your taxes is a great way to avoid paying these by accident. 

Penalty	Timing
2%	1-5 days late
5%	6-15 days late
10%	Within 10 days of your first IRS notice
15%	After 10 days of your first IRS notice

 

Are there exceptions when you don’t have to file?

For the most part, no. But there are a handful of outside cases to keep in mind:

1. If you operate a seasonal business that does not pay employees for entire quarters. Inform the IRS of this information when you do file by checking the box on line 18
2. If the total payroll tax liability of your business is less than $1000, file form 944 instead. This is effectively a form 941 which is due only once per year
3. If you employ household employees, such as maids or gardeners, and pay less than $2600 per year
4. If you employ election workers and pay them less than $2200 per year
5. If you employ agricultural labor, you file a form 943 instead

Staying on top of all the tax forms necessary for a growing business can be tricky. If you have more questions about form 941 or anything else regarding your business’s financials, book a call with one of our experts.