How to make an EFTPS payroll tax deposit (Form 941)

When you run payroll, you hold back federal taxes from each paycheck. You also owe the employer share of Social Security and Medicare. The IRS expects you to deposit that money on a schedule, and it has to go through EFTPS. This guide covers enrolling, making a deposit and avoiding late penalties.

What EFTPS is

EFTPS (Electronic Federal Tax Payment System) is the free Treasury system at eftps.gov. You use it to send federal tax deposits from your business bank account to the IRS. There is no fee to enroll or to pay.

Step 1: Enroll your business

Enroll well before your first deposit is due. The PIN comes by mail, so you can't do this the day before.

1. Go to eftps.gov.
2. Click Enrollment.
3. Choose Business as the enrollment type.
4. Enter your EIN, your business name and your business address exactly as the IRS has them.
5. Enter the bank routing number and account number you will pay from.
6. Review the details and submit.
7. Watch your mail. Your PIN arrives by U.S. mail in about 5 to 7 business days.

Step 2: Set up your login

1. When the PIN arrives, go to eftps.gov and click Login.
2. Enter your EIN and PIN.
3. Follow the prompts to create your Internet password.
4. Store the EIN, PIN and password somewhere safe. You need all three every time you pay.

Step 3: Figure out how much to deposit

For Form 941, your deposit equals:

• Federal income tax withheld from employees
• Plus employee Social Security and employer Social Security
• Plus employee Medicare and employer Medicare
• Plus any Additional Medicare tax withheld

Add these up for every payday covered by the deposit. Keep the three parts (Social Security, Medicare, income tax withheld) separate in your notes. EFTPS may ask for the breakdown.

FUTA (Form 940) is a separate tax and a separate deposit. Don't add it to your 941 deposit. See the FUTA section below.

Step 4: Know your due date

Your deposit schedule decides when the money is due.

• Monthly depositors deposit the taxes for a month by the 15th of the next month.
• Semiweekly depositors deposit on a Wednesday or Friday, depending on the day you paid wages. Check the IRS instructions for the exact rule that applies to your payday.
• The $100,000 rule: if you pile up $100,000 or more in taxes on any day, the deposit is due the next business day, no matter your normal schedule.

The IRS tells you which schedule applies to you. If you're not sure, check current IRS rules before your first payroll.

Step 5: Make the deposit

1. Go to eftps.gov and click Login.
2. Enter your EIN, PIN and Internet password.
3. Click Payments.
4. Choose Form 941 (Employer's Quarterly Federal Tax Return).
5. Choose Federal Tax Deposit as the payment type.
6. Pick the tax period. Use the quarter the wages were paid, not the quarter they were earned. If work happened in one quarter but payday fell in the next, use the payday quarter.
7. Enter the total deposit amount.
8. If asked, enter the breakdown: Social Security, Medicare and income tax withheld.
9. Pick a settlement date on or before your due date.
10. Review every field. Check the amount, the form, the period and the date.
11. Submit the payment by 8 p.m. Eastern at least one calendar day before the due date.
12. Save the EFT acknowledgment number. Write it down, screenshot it, or print the page. This is your proof that you scheduled the payment.

Depositing FUTA (Form 940)

FUTA is deposited separately in EFTPS. You only need to deposit it once your FUTA tax owed for the year goes over $500. When it does, deposit by the last day of the month after the quarter ends.

The steps match Step 5, but choose Form 940 instead of Form 941. Use the same care with the tax period and the settlement date, and save that acknowledgment number too.

If you missed the 8 p.m. cutoff

If it's too late to schedule a normal EFTPS payment for the due date, don't just wait. Call your bank and ask about a same-day ACH or a Fedwire payment. The IRS has same-day payment guidance for EFTPS. Check the current IRS instructions before you send it, since the bank will need specific details to route the payment correctly.

What late deposits cost

The IRS charges failure-to-deposit penalties based on how late the money is:

• 2% if the deposit is 1 to 5 days late
• 5% if it is 6 to 15 days late
• 10% if it is more than 15 days late
• 15% if the tax is still unpaid more than 10 days after an IRS notice

Those percentages apply to the unpaid deposit. On a regular payroll, that adds up fast. Scheduling a day or two early costs you nothing.

Common mistakes to avoid

• Waiting to enroll. The PIN takes days to arrive by mail. Enroll before your first payday.
• Wrong tax period. Use the quarter wages were paid. A wrong period can make a deposit look late or missing.
• Mixing FUTA into the 941 deposit. They are separate forms and separate payments.
• Forgetting the employer share. You deposit both the employee and employer portions of Social Security and Medicare.
• Not saving the acknowledgment number. Without it, proving you paid on time is harder.
• Cutting it close. Submit by 8 p.m. Eastern at least one calendar day before the due date.

Where Selfroll fits

Selfroll calculates your withholding, Social Security, Medicare and FUTA, tracks your deposit deadlines, and shows you the amounts and breakdown to enter in EFTPS. You log in to EFTPS and make the deposit yourself, since Selfroll never connects to a bank, moves money or files anything for you.

This guide is general information, not tax or legal advice. Check current IRS rules or ask a CPA.