Payroll tax returns: 941, 940 and W-2
Form 941 each quarter (Northwind's first by November 2, 2026), and Form 940 and the W-2s by February 1, 2027 — each tied to the register and the deposits.
Deposits pay the tax; returns report it. Three federal filings carry a payroll: the quarterly Form 941, the annual Form 940 for FUTA, and the W-2s at year end. Each must agree with the others and with the books, and when they don't, the notice arrives a year later.
October 31, 2026 is a Saturday, so Northwind's first 941 is due Monday, November 2, 2026. It deposited September's tax on time, so it may file as late as November 10, 2026. Its fourth-quarter 941, its 940 and the W-2s all fall on the same day: Monday, February 1, 2027, because January 31, 2027 is a Sunday.
November 2, 2026
Q3 return941
February 1, 2027
Q4 return — $6,682.50 of tax941
February 1, 2027
FUTA for the year — $84, paid with the return940
February 1, 2027
To each employee and to the SSAW-2, W-3
Northwind's FUTA never passes $500 in a quarter — $50.40 after Q3, $84 after Q4 — so it's never deposited during the year and the whole $84 is paid with Form 940.
The first W-2s
Boxes 1, 3 and 5 are not the salaries. Each is $487.50 below what Priya Shah and Marcus Lee were paid, because the premium taken out under the cafeteria plan from October is in none of the three wage bases. With no 401(k), the three boxes agree; a traditional 401(k) deferral would come out of box 1 and stay in boxes 3 and 5. Form W-2 box 12, code DD, reports the cost of employer-sponsored health coverage — employer's and employee's shares together, $1,950 each for 3 months of cover. It isn't taxable, and an employer that filed fewer than 250 Forms W-2 for the year before is under transition relief that makes it optional. Northwind may leave it off.
Step 1: Pull the quarter's register
Every payday's gross, withholding and net, footed, for the quarter.
Step 2: Tie the 941 to the register
Lines 2, 3, 5a and 5c are the register's totals. Anything paid outside payroll — a bonus wired by a founder, a manual check — is missing until someone adds it.
Step 3: Tie the deposits to EFTPS
Line 13 should equal what EFTPS shows was deposited for the quarter.
Step 4: Tie the books to both
The balance in payroll liabilities after the quarter's deposits should be the last month's tax, deposited next month, and nothing older.
Step 5: Approve and file
In the provider's portal or by e-file, before the due date.
At year end the W-3's totals should equal the four quarters' 941s — wages, Social Security and Medicare wages, and income tax withheld. States run alongside: withholding returns and W-2 copies where the state has an income tax, and unemployment wage reports, each on the state's own calendar. The compliance calendar lays them beside the federal ones.
Wrong
The provider files the 941, so it must be right.
Right
Each quarter, tie the 941 to the register, the deposits to EFTPS and the books to both.
The provider prepares the returns from what it was told. Reconciling them to the books is the company's job.
Form 941 every quarter, Form 940 and the W-2s by January 31 — and every one ties to the register, the deposits and the payroll liabilities in the books.
In this lesson: Form 941, line by line, filled in from Northwind's register.
Pages in this lesson
1 page goes deeper, about 5 minutes in all. Read them in order, or open the one you need.
Where this lesson's rules come from
The sources behind this lesson's requirements, by kind. Anything marked as a convention is ours, not the rule-maker's.
- IRS guidance
- IRS Pub. 15 (2026), Calendar (opens in a new tab)Form 941 is quarterly: April 30, July 31, October 31, January 31PDF · Free to read
- Instructions for Form 941 (Rev. March 2026) (opens in a new tab)Instructions for Form 941PDF · Free to read
- Instructions for Form 940 (2025) (opens in a new tab)Credit reduction statesPDF · Free to read
- General Instructions for Forms W-2 and W-3 (2026) (opens in a new tab)Forms W-2 and W-3 for 2026 wages are due February 1, 2027PDF · Free to read
- General Instructions for Forms W-2 and W-3 (2026), Box 12 — Code DD (opens in a new tab)Box 12, code DD: the cost of employer-sponsored health coveragePDF · Free to read
- IRS, Form W-2 Reporting of Employer-Sponsored Health Coverage (opens in a new tab)Code DD is optional for an employer that filed fewer than 250 Forms W-2 the year beforeFree to read
- IRS Pub. 15-B (2026), §1 Cafeteria Plans; §2 Table 2-1 (opens in a new tab)Employer's Tax Guide to Fringe BenefitsPDF · Free to read
- Official form
- Form 941 (Rev. March 2026) (opens in a new tab)Form 941, Employer's QUARTERLY Federal Tax ReturnPDF · Free to read
- Form 940 (2025) (opens in a new tab)Form 940, Employer's Annual Federal Unemployment (FUTA) Tax ReturnPDF · Free to read
- Form W-2 (2026) (opens in a new tab)Form W-2, Wage and Tax StatementPDF · Free to read
The words this lesson teaches
Each links to its glossary definition, which also names the authority behind it and the components that render it.
- Form 941The quarterly return of wages paid, federal income tax withheld and both halves of Social Security and Medicare tax, reconciled to the quarter's deposits. Due April 30, July 31, October 31 and January 31 — ten days later if every deposit was on time
- Form 940The employer's annual FUTA return, due January 31 of the next year — February 10 if every FUTA deposit was on time — with Schedule A for wages paid in a credit-reduction state
- Form W-2The year-end statement of an employee's wages and withholding — boxes 1, 3 and 5 for income tax, Social Security and Medicare wages — furnished to the employee and filed with the SSA by January 31, with no automatic extension
- Form W-3The transmittal that totals every Form W-2 an employer files with the SSA. Its totals should equal the year's four Forms 941
In the founder glossary
This lesson’s ideas, explained for the founder running the company. Each has an entry in the founder glossary.
See also
- Form 941 and payroll tax deposits for startupsWhat Form 941 reports, monthly vs semiweekly deposits, the $100,000 next-day rule, FUTA, the R&D payroll credit, and what your provider can’t do.
- W-2 year end for startups: boxes, deadlines, correctionsThe W-2 boxes founders get wrong (box 1 vs 3 vs 5, box 12 codes), the W-3, the SSA deadline, state copies, and how to fix a mistake with a W-2c.
- Startup tax deadlines by month for a C-corpFederal tax deadlines for a calendar-year C-corp, month by month: W-2s, 1099s, Form 941, Form 1120, estimated taxes and Delaware franchise tax.
- ComplianceCalendarFiling deadlines by jurisdiction, with the owner and the date penalties start.