Form 941: What Small Business Owners Need to Know to Stay Tax Compliant

Staying on top of your tax responsibilities is key to running a successful small business, and one of the most important recurring filings you’ll handle is Form 941 (Employer’s Quarterly Federal Tax Return).

Tax compliance

In this article, we’ll walk you through everything you need to know about Form 941—from who must file to deadlines, deposit schedules, and how to correct errors—so you can stay compliant and avoid penalties.

Understanding Form 941

Form 941 is required for most small businesses that withhold federal income tax, Social Security tax, and Medicare tax from employees’ wages. It’s used to:

  • Report wages paid
  • Withholdings and employer taxes
  • Adjustments (such as for tips or group-term life insurance)
  • And any tax deposits made during the quarter

Put simply, Form 941 gives the IRS a quarterly snapshot of your payroll activity and the taxes you’ve paid or owe.…

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