11. Depositing Taxes

Generally, you must deposit federal income tax withheld and both the employer and employee social security and Medicare taxes. You must use EFT to make all federal tax deposits. See How To Deposit , later in this section, for information on electronic deposit requirements.

Payment with return.

You may make a payment with a timely filed Form 941, Form 943, Form 944, or Form 945 instead of depositing, without incurring a penalty, if one of the following applies.

You’re a monthly schedule depositor (defined later) and make a payment in accordance with the accuracy of deposits rule , discussed later in this section. This payment may be $2,500 or more.

Your Form 941 total tax liability (Form 941, line 12) for either the current quarter or the prior quarter is less than $2,500, and you didn’t incur a $100,000 next-day deposit obligation during the current quarter. However, if you’re unsure that your total tax liability for the current quarter will be less than $2,500 (and your liability for the prior quarter wasn’t less than $2,500), make deposits using the semiweekly or monthly rules so you won’t be subject to an FTD penalty.

Your Form 943 total tax liability (Form 943, line 13) for the year is less than $2,500. However, if you’re unsure that you will report less than $2,500, deposit under the rules explained in this section so that you won’t be subject to an FTD penalty.

Your Form 944 total tax liability for the year (Form 944, line 9) is less than $2,500, or your Form 944 total tax liability for the year (Form 944, line 9) is $2,500 or more and you already deposited the taxes you owed for the first, second, and third quarters of the year; your net tax for the fourth quarter is less than $2,500; and you’re paying, in full, the tax you owe for the fourth quarter with a timely filed return.

Your Form 945 total tax liability (Form 945, line 3) for the year is less than $2,500. However, if you’re unsure that you will report less than $2,500, deposit under the rules explained in this section so that you won’t be subject to an FTD penalty.

Separate deposit requirements for nonpayroll (Form 945) tax liabilities.

Separate deposits are required for nonpayroll and payroll income tax withholding. Don’t combine deposits for Forms 941 (or Form 943 or Form 944) and Form 945 tax liabilities. Generally, the deposit rules for nonpayroll liabilities are the same as discussed next, except the rules apply to an annual rather than a quarterly return period. If the total amount of tax for the year reported on Form 945 is less than $2,500, you’re not required to make deposits during the year. See the separate Instructions for Form 945 for more information.

Separate deposit requirements for employers of both farm and nonfarm workers.

If you employ both farm and nonfarm workers, you must treat employment taxes for the farmworkers (Form 943 taxes) separately from employment taxes for the nonfarm workers (Form 941/944 taxes). Form 943 taxes and Form 941/944 taxes aren’t combined for purposes of applying any of the deposit schedule rules. If a deposit is due, deposit the Form 941/944 taxes and the Form 943 taxes by making separate deposits. For example, if you’re a monthly schedule depositor for both Form 941/944 taxes and Form 943 taxes and your tax liability at the end of April is $1,500 reportable on Form 941/944 and $1,200 reportable on Form 943, deposit both amounts by May 15. Use one transaction to deposit the $1,500 of Form 941/944 taxes and another transaction to deposit the $1,200 of Form 943 taxes.