Part 1 — Instruction 941 — Instructions for Form 941

1. Number of Employees Who Received Wages, Tips, or Other Compensation Enter the number of employees on your payroll for the pay period including March 12, June 12, September 12, or December 12, for the quarter indicated at the top of Form 941. Don’t include:

Household employees,
Employees in nonpay status for the pay period,
Farm employees,
Pensioners, or
Active members of the U.S. Armed Forces.

Caution: Employers in American Samoa, Guam, the CNMI, the USVI, and Puerto Rico must skip lines 2 and 3, unless you have employees who are subject to U.S. income tax withholding.

2. Wages, Tips, and Other Compensation Enter amounts on line 2 that would also be included in box 1 of your employees’ Forms W-2. See Box 1—Wages, tips, other compensation in the General Instructions for Forms W-2 and W-3 for details. Include sick pay paid by your agent. Also include sick pay paid by a third party that isn’t your agent (for example, an insurance company) if you were given timely notice of the payments and the third party transferred liability for the employer’s taxes to you.

If you’re a third-party payer of sick pay and not an agent of the employer, don’t include sick pay that you paid to policyholders’ employees here if you gave the policyholders timely notice of the payments. See section 6 of Pub. 15-A, Employer's Supplemental Tax Guide, for more information about sick pay reporting and the procedures for transferring the liability to the employer.

3. Federal Income Tax Withheld From Wages, Tips, and Other Compensation Enter the federal income tax you withheld (or were required to withhold) from your employees on this quarter’s wages, tips, taxable fringe benefits, and supplemental unemployment compensation benefits. Don’t include any income tax withheld by a third-party payer of sick pay even if you reported it on Forms W-2. You will reconcile this difference on Form W-3. Also include here any excise taxes you were required to withhold on golden parachute payments (section 4999). For information on the employment tax treatment of fringe benefits, see Pub. 15-B, Employer’s Tax Guide to Fringe Benefits. For information about supplemental unemployment compensation benefits and golden parachute payments, see section 5 of Pub. 15-A.

If you’re a third-party payer of sick pay, enter the federal income tax you withheld (or were required to withhold) on third-party sick pay here.

Instructions for Form 941 (Rev. 3-2026) 9

4. If No Wages, Tips, and Other Compensation Are Subject to Social Security or Medicare Tax... If no wages, tips, and other compensation on line 2 are subject to social security or Medicare tax, check the box on line 4. If this question doesn’t apply to you, leave the box blank. For more information about exempt wages, see section 15 of Pub. 15. For religious exemptions, see section 4 of Pub. 15-A.

Caution: If you’re a governmental employer, wages you pay aren’t automatically exempt from social security and Medicare taxes. Your employees may be covered by law or by a voluntary Section 218 Agreement with the SSA. For more information, see Pub. 963, Federal-State Reference Guide.

5a–5e. Taxable Social Security and Medicare Wages and Tips

5a. Taxable social security wages. Enter the total wages, sick pay, and taxable fringe benefits subject to social security tax you paid to your employees during the quarter. For this purpose, sick pay includes payments made by an insurance company to your employees for which you received timely notice from the insurance company. See section 6 of Pub. 15-A for more information about sick pay reporting. See the instructions for line 8, later, for an adjustment that you may need to make on Form 941 for sick pay.

Enter the amount before payroll deductions. Don’t include tips on this line. For information on types of wages subject to social security tax, see section 5 of Pub. 15.

For 2026, the rate of social security tax on taxable wages is 6.2% (0.062) each for the employer and employee. Stop paying social security tax on and entering an employee’s wages on line 5a when the employee’s taxable wages and tips reach $184,500 for the year. However, continue to withhold income and Medicare taxes for the whole year on all wages and tips, even when the social security wage base limit of $184,500 has been reached.

Cash tips include tips paid by cash, check, debit card, and credit card. The report should include charged tips (for example, credit and debit card charges) you paid over to the employee for charge customers, tips the employee received directly from customers, and tips received from other employees under any tip-sharing arrangement. Both directly and indirectly tipped employees must report tips to you. No report is required for months when tips are less than $20. Employees may submit a written statement or electronic tip record.

Don’t include allocated tips (described in section 6 of Pub. 15) on this line. Instead, report them on Form 8027. Allocated tips aren’t reportable on Form 941 and aren’t subject to withholding of federal income, social security, or Medicare tax.

line 5b (column 1) x 0.124

line 5b (column 2)

5c. Taxable Medicare wages & tips. Enter all wages, tips, sick pay, and taxable fringe benefits that are subject to Medicare tax. Unlike social security wages, there is no limit on the amount of wages subject to Medicare tax.

The rate of Medicare tax is 1.45% (0.0145) each for the employer and employee. Include all tips your employees reported during the quarter, even if you were unable to withhold the employee tax of 1.45%.

line 5c (column 1) x 0.029

line 5c (column 2)

line 5a (column 1) x 0.124

line 5a (column 2)

5b. Taxable social security tips. Enter all tips your employees reported to you during the quarter until the total of the tips and taxable wages, including wages reported on line 5a, for an employee reaches $184,500 for the year. Include all tips your employee reported to you even if you were unable to withhold the employee tax of 6.2%. You will reduce your total taxes by the amount of any uncollected employee share of social security and Medicare taxes on tips later on line 9; see Current quarter’s adjustments for tips and group-term life insurance , later. Don’t include service charges on line 5b. For details about the difference between tips and service charges, see Rev. Rul. 2012-18, 2012-26 I.R.B. 1032, available at IRS.gov/irb/2012-26_IRB#RR-2012-18 .

Your employee must report cash tips to you by the 10th day of the month after the month the tips are received.

For more information on tips, see section 6 of Pub. 15. See the instructions for line 8, later, for an adjustment that you may need to make on Form 941 for sick pay.

5d. Taxable wages & tips subject to Additional Medi- care Tax withholding. Enter all wages, tips, sick pay, and taxable fringe benefits that are subject to Additional Medicare Tax withholding. You’re required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Additional Medicare Tax is only imposed on the employee. There is no employer share of Additional Medicare Tax. All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold.

For more information on what wages are subject to Medicare tax, see section 15 of Pub. 15. For more information on Additional Medicare Tax, go to IRS.gov/ ADMTfaqs . See the instructions for line 8, later, for an adjustment that you may need to make on Form 941 for sick pay.

Once wages and tips exceed the $200,000 withholding threshold, include all tips your employees reported during the quarter, even if you were unable to withhold the employee tax of 0.9%.

10 Instructions for Form 941 (Rev. 3-2026)

line 5d (column 1) x 0.009

line 5d (column 2)

5e. Total social security and Medicare taxes. Add the column 2 amounts on lines 5a–5d. Enter the result on line 5e.

5f. Section 3121(q) Notice and Demand—Tax Due on Unreported Tips Enter the tax due from your Section 3121(q) Notice and Demand on line 5f. The IRS issues a Section 3121(q) Notice and Demand to advise an employer of the amount of tips received by employees who failed to report or underreported tips to the employer. An employer isn’t liable for the employer share of the social security and Medicare taxes on unreported tips until notice and demand for the taxes is made to the employer by the IRS in a Section 3121(q) Notice and Demand. The tax due may have been determined from tips reported to the IRS on employees’ Forms 4137, Social Security and Medicare Tax on Unreported Tip Income, or other tips that weren’t reported to their employer as determined by the IRS during an examination. For additional information, see Rev. Rul. 2012-18 .

Deposit the tax within the time period required under your deposit schedule to avoid any possible deposit penalty. The tax is treated as accumulated by the employer on the “Date of Notice and Demand” as printed on the Section 3121(q) Notice and Demand. The employer must include this amount on the appropriate line of the record of federal tax liability (Part 2 of Form 941 for a monthly schedule depositor or Schedule B (Form 941) for a semiweekly schedule depositor).

6. Total Taxes Before Adjustments Add the total federal income tax withheld from wages, tips, and other compensation (line 3); the total social security and Medicare taxes before adjustments (line 5e); and any tax due under a Section 3121(q) Notice and Demand (line 5f). Enter the result on line 6.

7–9. Tax Adjustments Enter tax amounts on lines 7–9 that result from current-quarter adjustments. Use a minus sign (if possible) to show an adjustment that decreases the total taxes shown on line 6 instead of parentheses. Doing so enhances the accuracy of our scanning software. For example, enter “-10.59” instead of “(10.59).” However, if your software only allows for parentheses in entering negative amounts, you may use them.

Current quarter’s adjustments. In certain cases, you must adjust the amounts you entered as social security and Medicare taxes in column 2 of lines 5a–5d to figure your correct tax liability for this quarter’s Form 941. See section 13 of Pub. 15.

7. Current quarter’s adjustment for fractions of cents. Enter adjustments for fractions of cents (due to rounding) relating to the employee share of social security and Medicare taxes withheld. The employee share of amounts shown in column 2 of lines 5a–5d may differ

slightly from amounts actually withheld from employees’ pay due to the rounding of social security and Medicare taxes based on statutory rates. This adjustment may be a positive or a negative adjustment.

8. Current quarter’s adjustment for sick pay. If your third-party payer of sick pay that isn’t your agent (for example, an insurance company) transfers the liability for the employer share of the social security and Medicare taxes to you, enter a negative adjustment on line 8 for the employee share of social security and Medicare taxes that were withheld and deposited by your third-party sick pay payer on the sick pay. If you’re the third-party sick pay payer and you transferred the liability for the employer share of the social security and Medicare taxes to the employer, enter a negative adjustment on line 8 for any employer share of these taxes required to be paid by the employer. The sick pay should be included on line 5a, line 5c, and, if the withholding threshold is met, line 5d.

No adjustment is reported on line 8 for sick pay that is paid through a third party as an employer’s agent. An employer’s agent bears no insurance risk and is reimbursed on a cost-plus-fee basis for payment of sick pay and similar amounts. If an employer uses an agent to pay sick pay, the employer reports the wages on line 5a, line 5c, and, if the withholding threshold is met, line 5d, unless the employer has an agency agreement with the third-party payer that requires the third-party payer to do the collecting, reporting, and/or paying or depositing employment taxes on the sick pay. See section 6 of Pub. 15-A for more information about sick pay reporting. 9. Current quarter’s adjustments for tips and group-term life insurance. Enter a negative adjustment for:

Any uncollected employee share of social security and Medicare taxes on tips, and
The uncollected employee share of social security and Medicare taxes on group-term life insurance premiums paid for former employees.

See the General Instructions for Forms W-2 and W-3 for information on how to report the uncollected employee share of social security and Medicare taxes on tips and group-term life insurance on Form W-2.

Prior quarter’s adjustments. If you need to correct any adjustment reported on a previously filed Form 941, complete and file Form 941-X. Form 941-X is an adjusted return or claim for refund and is filed separately from Form 941. See section 13 of Pub. 15.

10. Total Taxes After Adjustments Combine the amounts shown on lines 6–9 and enter the result on line 10.

11. Qualified Small Business Payroll Tax Credit for Increasing Research Activities Enter the amount of the credit from Form 8974, line 12 or, if applicable, line 17. If you enter an amount on line 11, you must attach Form 8974.

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12. Total Taxes After Adjustments and Nonrefundable Credits Subtract line 11 from line 10 and enter the result on line 12. The amount entered on line 12 can’t be less than zero.

If line 12 is less than $2,500 or line 12 on the prior quarterly return was less than $2,500, and you didn’t incur a $100,000 next-day deposit obligation during the current quarter. You may pay the amount with Form 941 or you may deposit the amount. To avoid a penalty, you must pay any amount you owe in full with a timely filed return or you must deposit any amount you owe before the due date of the return. For more information on paying with a timely filed return, see the instructions for line 14, later.
If line 12 is $2,500 or more and line 12 on the prior quarterly return was $2,500 or more, or if you incurred a $100,000 next-day deposit obligation during the current quarter. You must make required deposits according to your deposit schedule. The amount shown on line 12 must equal the “Total liability for quarter” shown on line 16 or the “Total liability for the quarter” shown on Schedule B (Form 941). For more information, see the line 16 instructions, later.

For more information and rules about federal tax deposits, see Depositing Your Taxes , earlier, and section 11 of Pub. 15.

Caution: If you’re a semiweekly schedule depositor, you must complete Schedule B (Form 941). If you fail to complete and submit Schedule B (Form 941), the IRS may assess deposit penalties based on available information.

13. Total Deposits for This Quarter Enter your deposits for this quarter, including any overpayment from a prior quarter that you applied to this return. Also include in the amount shown any overpayment that you applied from filing Form 941-X, 941-X (PR), or 944-X in the current quarter.

14. Balance Due If line 12 is more than line 13, enter the difference on line 14. Otherwise, see the instructions for line 15a, later.

Never make an entry on both lines 14 and 15a.

You don’t have to pay if line 14 is under $1. Generally, you should have a balance due only if your total taxes after adjustments and nonrefundable credits (line 12) for the current quarter or prior quarter are less than $2,500, and you didn’t incur a $100,000 next-day deposit obligation during the current quarter. However, see section 11 of Pub. 15 for information about payments made under the accuracy of deposits rule.

If you were required to make federal tax deposits, pay the amount shown on line 14 by EFT. If you weren’t required to make federal tax deposits (see Must You Deposit Your Taxes , earlier) or you’re a monthly schedule depositor making a payment under the accuracy of deposits rule, you may pay the amount shown on line 14 by EFT, credit card, debit card, check, money order, or EFW. For more information on electronic payment options, go to IRS.gov/Pay .

Caution: If you’re required to make deposits and instead pay the taxes with Form 941, you may be subject to a penalty. See Must You Deposit Your Taxes, earlier.

If you pay by EFT, credit card, or debit card, file your return using the Without a payment address under Where Should You File, earlier, and don’t file Form 941-V, Payment Voucher.

If you pay by check or money order, make it payable to “United States Treasury.” Enter your EIN, “Form 941,” and the tax period (“1st Quarter 2026,” “2nd Quarter 2026,” “3rd Quarter 2026,” or “4th Quarter 2026”) on your check or money order. Complete Form 941-V and enclose it with Form 941.

If line 12 is $2,500 or more on both your prior- and current-quarter Forms 941, and you’ve deposited all taxes when due, the balance due on line 14 should be zero.

What if you can’t pay in full? If you can’t pay the full amount of tax you owe, you can apply for an installment agreement online. You can apply for an installment agreement online if:

You can’t pay the full amount shown on line 14,
The total amount you owe is $25,000 or less, and
You can pay the liability in full in 24 months. To apply using the Online Payment Agreement Application, go to IRS.gov/OPA .

Under an installment agreement, you can pay what you owe in monthly installments. There are certain conditions you must meet to enter into and maintain an installment agreement, such as paying the liability within 24 months, and making all required deposits and timely filing tax returns during the length of the agreement.

If your installment agreement is accepted, you will be charged a fee and you will be subject to penalties and interest on the amount of tax not paid by the due date of the return.

15a. Overpayment If line 13 is more than line 12, enter the difference on line 15a.

Never make an entry on both lines 14 and 15a.

15b. Choose to have your overpayment applied to your next return or refunded. If you deposited more than the correct amount for the quarter, you can choose to have the IRS either refund the overpayment or apply it to your next return. Check only one box on line 15b. If you don’t check either box or if you check both boxes, we will generally apply the overpayment to your next return. Regardless of any boxes you check or don’t check on line 15b, we may apply your overpayment to any past due tax account that is shown in our records under your EIN. If you check the box to have your overpayment refunded but you don’t complete lines 15c–15e for direct deposit, your refund may be delayed.

If line 15a is under $1, we will send a refund or apply it to your next return only if you ask us in writing to do so.

Direct Deposit

The benefits of a direct deposit include a faster refund, the added security of a paperless payment, and the savings of

12 Instructions for Form 941 (Rev. 3-2026)

tax dollars associated with the reduced processing costs. To have your refund direct deposited, you must complete lines 15c–15e.

15c. Routing number. The routing number must be nine digits. The first two digits must be 01 through 12 or 21 through 32. Verify that your financial institution will accept a direct deposit.

Ask your financial institution for the correct routing number to enter on line 15c if:

The routing number on a deposit slip is different from the routing number on your checks,
Your deposit is to a savings account that doesn’t allow you to write checks, or
Your checks state they’re payable through a financial institution different from the one at which you have your checking account.

15d. Type of account. Check the appropriate box for the type of account. Don’t check more than one box. You must check the correct box to ensure your deposit is accepted. If you’re unsure which box to check for the account you wish the deposit to be applied to, consult your financial institution.

15e. Account number. The account number can be up to 17 characters (both numbers and letters). Include hyphens but omit spaces and special symbols. Enter the number from left to right and leave any unused boxes blank.

If the direct deposit to your account is different from the amount you expected, you’ll receive an explanation in the mail about 2 weeks after your refund is deposited.

Reasons Your Direct Deposit Request Will Be Rejected

monthly tax liability on Form 941 or your daily tax liability on Schedule B (Form 941).

Caution: The amounts entered on line 16 are a summary of your monthly tax liability, not a summary of deposits you made. If you don’t properly report your liabilities when required or if you’re a semiweekly schedule depositor and enter your liabilities on line 16 instead of on Schedule B (Form 941), you may be assessed an “averaged” FTD penalty. See Deposit Penalties in section 11 of Pub. 15 for more information.

De minimis exception. If line 12 is less than $2,500 or line 12 on the prior quarterly return was less than $2,500, and you didn’t incur a $100,000 next-day deposit obligation during the current quarter, check the first box on line 16 and go to Part 3.

If you meet the de minimis exception based on the prior quarter and line 12 for the current quarter is $100,000 or more, you must provide a record of your federal tax liability. If you’re a monthly schedule depositor, complete the deposit schedule on line 16. If you’re a semiweekly schedule depositor, attach Schedule B (Form 941).

Monthly schedule depositor. If you reported $50,000 or less in taxes during the lookback period, you’re a monthly schedule depositor unless the $100,000 Next-Day Deposit Rule discussed in section 11 of Pub. 15 applies. Check the second box on line 16 and enter your tax liability for each month in the quarter. Enter your tax liabilities in the month that corresponds to the dates you paid wages to your employees, not the date payroll liabilities were accrued or deposits were made. Add the amounts for each month. Enter the result in the “Total liability for quarter” box.

Note that your total tax liability for the quarter must equal your total taxes shown on line 12. If it doesn’t, your tax deposits and payments may not be counted as timely. Don’t change your tax liability on line 16 by adjustments reported on any Forms 941-X.

You’re a monthly schedule depositor for the calendar year if the amount of your Form 941 taxes reported for the lookback period is $50,000 or less. The lookback period is the 4 consecutive quarters ending on June 30 of the prior year. For 2026, the lookback period begins July 1, 2024, and ends June 30, 2025. For details on the deposit rules, see section 11 of Pub. 15. If you filed Form 944 in either 2024 or 2025, your lookback period is the 2024 calendar year.

Reporting adjustments from lines 7–9 on line 16. If your net adjustment during a month is negative and it exceeds your total tax liability for the month, don’t enter a negative amount for the month. Instead, enter “-0-” for the month and carry over the unused portion of the adjustment to the next month.

Semiweekly schedule depositor. If you reported more than $50,000 of taxes for the lookback period, you’re a semiweekly schedule depositor. Check the third box on line 16.

You must complete Schedule B (Form 941) and submit it with your Form 941. Don’t file Schedule B (Form 941) with your Form 941 if you’re a monthly schedule depositor.

If any of the following apply, your direct deposit request will be rejected and a check will be sent instead.

The name on your account doesn’t match the name on the refund, and your financial institution won't allow a refund to be deposited unless the name on the refund matches the name on the account.
Your business is a corporation and the receiving financial institution is a foreign bank or a foreign branch of a U.S. bank.
You haven’t given a valid account number.
Any numbers or letters on lines 15c–15e are crossed out or whited out.

Caution: The IRS isn’t responsible for a lost refund if you enter the wrong account information. Check with your financial institution to get the correct routing and account numbers and to make sure your direct deposit will be accepted.