What are the penalty rates for Form 941?
183 views | Last modified 10/25/2023 1:31:07 AM EST | Added by TaxBandits Team

Applicable To
94X 1099 W-2 ACA W-4

The IRS imposes penalties for two main reasons.

  • Failing to file Form 941 return
  • Failing to pay payroll taxes

If you fail to file Form 941 by the deadline, the IRS will impose a penalty of 5 percent of your total tax due for each month that you are delaying, and it can go up to 25 percent.

In addition to failing to file, if you have failed to pay the tax due, the IRS will initially charge 0.5 percent of the unpaid tax amount, and it increases each month until you pay the tax due. This penalty will increase to 1% per ten days after receiving the IRS notice of intent to levy.

Please note if you fall into either of these categories, you must pay the penalty directly to the IRS by contacting them at (800)829-4933.

However, to avoid such penalties, always  ensure you follow the below checklist:

  • Pay full tax amounts when they are due
  • Don’t wait for the last minute – File your 941 on time
  • Report your tax liability without errors
  • Be sure the checks are valid
  • Provide your employees with the correct W-2
  • Make sure all the entries are correct
  • Always check your EIN before filing



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