7.2 Tax Deposit Schedules & Forms 941, 940, W-2 & W-3

Deposits are a schedule, not a payroll frequency

Chapter 6 computed employee FIT and FICA. Section 7.1 computed the employer FICA match and FUTA. None of that money may sit in the operating account until "we get around to it." Publication 15 (2026) section 11 requires electronic funds transfer for federal employment-tax deposits. You can pay through an IRS business tax account, IRS Direct Pay for businesses, or EFTPS. Paper coupons are not the current deposit method.

Two different clocks. (1) Form 941 taxes — withheld FIT, employee Social Security and Medicare, employer Social Security and Medicare, and Additional Medicare withheld from the employee — use the monthly or semiweekly deposit schedule in Publication 15. (2) FUTA uses Topic 759's $500 quarterly rule from Section 7.1. Publication 15 is explicit: the monthly/semiweekly rules do not apply to FUTA. Mixing the clocks is how a bookkeeper deposits FUTA every Wednesday and still misses a Q1 FUTA deposit after the wage base is hit.

This independent OpenExamPrep section uses Publication 15 (2026) section 11, the Instructions for Form 941 (When Must You File?), Topic 759, and the IRS About Form 941 / About Form W-2 pages. It does not reprint every line of Form 941.

Lookback period: how you become monthly or semiweekly for 2026

Before each calendar year you determine which deposit schedule you must use. Publication 15: the schedule is based on total tax liability reported on Forms 941, line 12 (or the analogous line on Form 943/944/945) during a lookback period. It is not based on how often you pay employees or how often you currently deposit.

Form 941 filers (2026). Lookback is the four quarters from July 1, 2024 through June 30, 2025:

Threshold (Publication 15). If lookback taxes were $50,000 or less, you are a monthly schedule depositor for 2026. If lookback taxes were more than $50,000, you are a semiweekly schedule depositor. Adjustments on Form 941-X do not change the lookback amount originally reported.

New business. For Form 941 filers, lookback tax before you started is treated as zero, so the first calendar year is monthly—unless the $100,000 next-day rule, below, promotes you to semiweekly.

North Finch lookback (monthly). Line 12 totals: Q3 2024 $8,200 + Q4 2024 $9,100 + Q1 2025 $8,800 + Q2 2025 $9,400 = $35,500. $35,500 ≤ $50,000, so North Finch is a monthly depositor for 2026.

Oakline Goods lookback (semiweekly). The same four quarters sum to $62,000. $62,000 > $50,000, so Oakline is semiweekly for 2026 even if it still pays employees only twice a month.

What each schedule actually requires

Deposit period. For monthly depositors the deposit period is a calendar month. For semiweekly depositors the periods are Wednesday through Friday and Saturday through Tuesday.

Monthly example. North Finch pays on Friday, January 16, 2026. January Form 941 taxes are due by the 15th of February. In 2026, February 15 is a Sunday and February 16 is Washington's Birthday (Presidents' Day), a legal holiday, so Publication 15 moves the deposit to the next business day: Tuesday, February 17, 2026. Do not file Form 941 monthly just because you are a monthly depositor—Form 941 remains quarterly.

Semiweekly example. Oakline pays on Friday, June 12, 2026. Friday sits in the Wednesday–Friday window, so the deposit is due Wednesday, June 17, 2026. Paying once a month does not convert a semiweekly employer into a monthly depositor; it only means fewer deposit events, each still on the semiweekly due date. Semiweekly Form 941 filers complete Schedule B (Form 941) and report liabilities by the date wages were paid, not the date of the deposit.

Quarter split. Publication 15: if two pay dates in the same semiweekly period fall in different calendar quarters, make separate deposits. A Wednesday, September 30, 2026 payday and a Friday, October 2, 2026 payday need two deposits even though both would otherwise be due Wednesday, October 7, 2026.

$100,000 next-day rule

If you accumulate $100,000 or more in Form 941 taxes on any day during a monthly or semiweekly deposit period, deposit by the next business day. Stop accumulating at the end of that day; the next day's tax starts a new pile. The $100,000 test is before nonrefundable credits. A monthly depositor who trips this rule becomes a semiweekly depositor the next day and remains semiweekly for the rest of that calendar year and the following calendar year. A brand-new employer with a zero lookback is still monthly until a day hits $100,000.

Paying with Form 941 instead of depositing. Publication 15 / Form 941 instructions: you may pay with a timely Form 941, without an FTD penalty, if line 12 for the current or prior quarter is less than $2,500 and you did not incur a $100,000 next-day obligation during the current quarter. If you are not sure the current quarter will stay under $2,500 (and the prior quarter was not under $2,500), deposit on the monthly or semiweekly schedule. This $2,500 convenience is not a third deposit schedule and does not replace the $100,000 rule.

Nonpayroll withholding (backup withholding, certain 1099 withholding) uses Form 945 and separate deposits. Do not combine Form 941 and Form 945 deposits. Section 7.3 returns to backup withholding.

Form 941: the quarterly employment tax return

Employers use Form 941, Employer's QUARTERLY Federal Tax Return, to report withheld FIT, Social Security and Medicare taxes withheld, and the employer's share of Social Security and Medicare. File for the quarter you first pay taxable wages, then every quarter even if wages are zero, unless you file a final return or you are a qualifying seasonal employer who checks the seasonal box.

Due dates (Instructions for Form 941). Form 941 is due by the last day of the month that follows the end of the quarter:

If you made timely deposits in full payment of the quarter's taxes, you may file by the 10th day of the second month after the quarter (for example, May 10 for the first quarter). If a due date falls on Saturday, Sunday, or a legal holiday, file the next business day. Correct a previously filed Form 941 on Form 941-X, filed separately—do not overwrite the original 941 as if it were an income-tax amended return.

Form 944 is an annual employment tax return the IRS notifies certain small employers to use. Do not switch yourself to Form 944 because the payroll is small.

Form 940: annual FUTA return

Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return, is the annual FUTA form. Topic 759: due January 31. If you deposited all FUTA tax when due, you have until February 10 to file. Credit-reduction or multi-state wages: attach Schedule A (Form 940). A final Form 940 is filed when the business closes or stops paying wages; until then, a zero-wage Form 940 may still be required if you have not filed a final return.

Forms W-2 and W-3: the wage statements that must reconcile

Form W-2, Wage and Tax Statement, goes to each employee. Furnish the employee copies by January 31 for the prior calendar year. File Copy A with the Social Security Administration, not in the same envelope as Form 941. Form W-3, Transmittal of Wage and Tax Statements, is the cover transmittal that totals the W-2s. SSA's Business Services Online can create W-3 from the W-2 file. If you used a different EIN on Forms 941 than on Form W-3, Publication 15 tells you to enter the other EIN in the W-3 "Other EIN used this year" box.

Reconciliation the exam expects. Publication 15: compare Form W-3 to the four quarterly Forms 941. FIT withheld should agree. Social Security and Medicare taxes on Forms 941 are generally about twice the employee amounts on Form W-3, because 941 reports employer and employee FICA while W-3 reports employee tax. Additional Medicare Tax breaks the Medicare doubling: 941 includes the 0.9% withheld, W-3 box 6 is employee Medicare withheld including that 0.9%, and there is no employer 0.9% on 941 to double. Keep a reconciliation file so an IRS or SSA mismatch letter is explainable. Acquisitions and mergers may need Schedule D (Form 941). Corrections after filing use Form W-2c and Form W-3c.

Exam traps. (1) Treating pay-frequency as the deposit schedule. (2) Using $50,000 of wages instead of lookback line 12 tax. (3) Depositing FUTA on the semiweekly calendar. (4) Filing Form 941 only for quarters with pay. (5) Sending W-2 Copy A to the IRS with Form 941 instead of to SSA with W-3. (6) Expecting 941 Medicare tax to be exactly 2 × W-3 Medicare when Additional Medicare was withheld. (7) Inventing a lookback dollar other than the $50,000 Publication 15 threshold.