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Form 941-M filers off the hook, but other sanctions may apply

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in Office Management,Payroll Management

The IRS has retired Form 941-M, which is filed monthly by employers with serious payroll compliance problems. Also retired are the special deposit rules, which required deposits to be made into a special trust fund account within two banking days of payday. Those employers must now file Form 941 quarterly and deposit withheld taxes electronically, according to their regular deposit schedule.

Warning: Those employers haven’t wiggled out of heightened scrutiny. The IRS now recommends that auditors pursue civil injunctions against employers that have a prior history of not timely depositing their payroll taxes, and that continue to do so. What’s that? A civil injunction is a court order that requires em­­ployers to comply with the payroll reporting and deposit rules.

In addition, revenue officers will continue to identify and develop civil and criminal cases against noncompliant employers. (SBSE-05-1211-909)

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