Caution:

If you’re a monthly schedule depositor and accumulate a $100,000 tax liability on any day during the deposit period, you become a semiweekly schedule depositor on the next day and remain so for at least the rest of the calendar year and for the following calendar year.

Example.

Elm, Inc., started its business on May 4, 2026. On Wednesday, May 6, it paid wages for the first time and accumulated a tax liability of $40,000. On Friday, May 8, Elm, Inc., paid wages and accumulated a liability of $60,000, bringing its total accumulated tax liability to $100,000. Because this was the first year of its business, the tax liability for its lookback period is considered to be zero, and it would be a monthly schedule depositor based on the lookback rules. However, because Elm, Inc., accumulated a $100,000 liability on May 8, it became a semiweekly schedule depositor on May 9. It will be a semiweekly schedule depositor for the remainder of 2026 and for 2027. Elm, Inc., is required to deposit the $100,000 by Monday, May 11, the next business day.