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Employer’s Guide: How to File Payroll Forms for Employers

Payroll formsPayroll forms
min read
August 21, 2023

Payroll can be a headache for many employers thanks to the sheer number of forms you need to keep track of.

You have to submit some forms to the IRS, like forms 940 and 941, and keep records of others, like I-9s and W-4s. 

In short, there's a lot of work to be done when running payroll and filing your tax returns, and as an employer, you should be familiar with the 13 most common payroll forms.

Keep reading to learn more about these forms and the information you need to file the required forms when the time comes.

What Forms Are Required for Payroll?

The forms required to file income and payroll taxes depend on your business and the type of workers you have. For example, if you work with employees, you'll file Form W-2s. But if your workforce consists of independent contractors, you'll file Form 1099-NECs.

Other forms like Form I-9 and W-4s are important for running payroll, but you don't necessarily submit them to the IRS. 

With that in mind, let's look at the 13 most common payroll forms you need to file your returns to the Internal Revenue Service.

1. Form I-9: Employment Eligibility Verification

Who submits it: Employee

Sent to: Employer

Deadline: Beginning of employment

We'll cover this form first since you can't file returns without verifying your employees' identities

Employers in the United States are only permitted to hire employees who can prove their identity and eligibility to work in the country. Form I-9 is used to verify the identity of new employees to prove they're allowed to work in the U.S.

You should only complete the form once you've offered someone a job. You'll also need to keep records of I-9 forms for three years after hiring someone or one year after you fire them.

2. Form W-4: Employee's Withholding Certificate

Who submits it: Employee

Sent to: Employer

Deadline: Beginning of employment

New employees should fill out Form W-4 before you add them to your payroll. The form specifies the federal income tax you should deduct from the employee's pay. 

Consider giving your employees the W-4 forms during onboarding because you'll need that information when figuring out their tax liability. 

3. State Withholding Allowance Certificate (State W-4s)

Who submits it: Employee

Sent to: Employer

Deadline: Beginning of employment

Most states have their own W-4s you'll need an employee to fill out for state income tax withholding. While Colorado and Delaware are among those states, they accept federal W-4s as a replacement for their own W-4s. 

On the other hand, New Mexico, North Dakota, and Utah don't have a state W-4. So they use the information from the federal Form W-4. 

Alaska, Nevada, Florida, New Hampshire, Tennessee, South Dakota, Texas, Wyoming, and Washington don't have any state income tax—so you don't need a state W-4 at all. You also don't need a state W-4 for Pennsylvania since it imposes a flat state income tax rate. 

4. Form W-2: Wage and Tax Statement

Who submits it: Employer

Sent to: Social Security Administration (SSA)

Deadline: Jan. 31

Form W-2 is the workhorse of income taxes and the form you've probably heard the most about. As an employer, you have to submit a W-2 form to the Social Security Administration (SSA) for every employee who earns more than $600 for the calendar year by Jan. 31. 

If the date falls on a weekend or legal holiday, the deadline will shift to the next business day.

If you do business in a state or locality that has state and local income tax, you may need to submit W-2 copies to those tax offices as well.

You also send each employee a copy of their W-2 by Jan. 31. They use it to file their personal income tax return. 

Form W-2 is used to report an individual employee's tax information, including:

  • Employee's gross wages
  • Withheld federal income tax
  • Withheld FICA taxes (Social Security and Medicare)
  • Withheld state and local income taxes

It's important to prepare W-2s correctly and file them on time to avoid steep tax penalties from the IRS. 

As of 2023, the federal agency can fine you $50 to $310 per form, depending on how late you decide to file it. If you intentionally don't file a W-2, you might have to pay more than $630 per form (unfortunately, there's no hard limit). Plus, the IRS charges interest on penalties that can quickly up the total fine.  

Not to mention, these penalties increase almost every year. In simple words, make sure to file W-2s correctly on time.  

Sound complicated? Payroll software like Hourly keeps track of payroll forms, does the tax calculations for you, and files your payroll taxes with the right government agencies.

5. Form W-3: Transmittal of Wage and Tax Statement

Who submits it: Employer

Sent to: Social Security Administration (SSA)

Deadline: Jan. 31

Form W-3 is an IRS form that includes the totals of all your employees' W-2 forms. Like W-2s, you should submit this form to the Social Security Administration (SSA) by Jan. 31 and keep one copy for your records. You don't need to send the W-3 form to employees.

Something worth noting is that even if you have one employee and file a single W-2, you must also submit a W-3 to the SSA. For example, if you're a business owner and the only employee of the business, you still have to file a W-3.

With that in mind, here's the information you need to fill out Form W-3:

  • Business details and legal address
  • Employer identification number (EIN)
  • W-2 forms 
  • Payroll records

You can usually send the W-3 form as an e-file or through the mail, but SSA recommends sending it electronically since it's more secure than mailing it. It also improves accuracy. 

If you're submitting over 250 W-2s, you must file the W-3 form electronically through the SSA's Business Services Online (BSO) portal. The only exception is if the IRS grants you a waiver.

The good news is that if you file W-2s electronically, the BSO will automatically generate a W-3 form for you, so you won't need to file the W-3 again to the SSA. 

6. Form 1099-NEC: Nonemployee Compensation

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: Jan. 31

As an employer, you must file Form 1099-NEC to the IRS to report payments to independent contractors, freelancers, sole proprietors, and self-employed individuals that exceed $600 in nonemployee compensation in a tax year by Jan. 31. Requirements for state and local tax agencies vary.

Similar to giving W-2s to employees, you must also provide Form 1099-NECs to independent contractors by Jan. 31.

The IRS reintroduced Form 1099-NEC in 2020 to report income for independent contractors. Previously, you'd report income for nonemployees on box 7 of Form 1099-MISC.

7. Form 940: Employer's Annual Federal Unemployment Tax Return

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: Jan. 31 

As an employer, you use Form 940 to report how much federal unemployment tax you paid throughout the year to the IRS to comply with the Federal Unemployment Tax Act (FUTA).

FUTA is a federal law that was created to help provide temporary income for people that are laid off or fired. As an employer, you must pay FUTA tax for any employee who works more than 20 weeks in a year or earns $1,500 in a quarter. The tax rate is 6 percent on the first $7,000 of wages you pay an employee each year.

If your total FUTA tax for the year is less than $500, you may pay the FUTA tax with your Form 940. On the other hand, if your FUTA tax for the year is more than $500, you must make one or more quarterly deposits.

While the quarterly deadlines fall on the last day of the month following the end of each quarter, you must only deposit the FUTA tax on a quarterly deadline if it exceeds $500. If you owe less than $500 in a quarter, you must deposit it on the next quarterly deadline, or the next (if it's still below $500). 

The deadline to file Form 940 is Jan. 31 for most employers. But if you owed more than $500 and paid quarterly on time, you have until Feb. 10 to file it.

8. Form 941: Employer's Quarterly Federal Tax Return

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: April 30, July 31, Oct. 31, and Jan. 31

Employers use Form 941 to report income and FICA taxes withheld from employees' paychecks each quarter.

The due dates for filing Form 941 fall on the last day of the month after a quarter ends:

  • First Quarter: April 30
  • Second Quarter: July 31
  • Third Quarter: Oct. 31
  • Fourth Quarter: Jan. 31

At the end of the fourth quarter, you should've filed four Form 941s, one at the end of each quarter. The total amount on these four forms must equal the total of all W-2 forms or the amount on the W-3 form you send to the Social Security Administration (SSA).

The IRS has some exceptions for certain categories of employers. If you're a seasonal employer, you don't need to submit Form 941 for the quarters where you have no tax liability since you haven't paid any wages. Just check the box on line 18 on Form 941 to inform the federal agency you won't be filing a return for one or more quarters.

You also won't need to file Form 941 if you pay wages to household employees or farm workers who offer agricultural labor.

It’s also important to note that the deposit or payment for the employer's portion of Social Security and Medicare taxes is due separately from the quarterly form filing.

There are two main deposit schedules for the taxes you report on Form 941:

They include:

  • Monthly: You deposit your employer taxes for the month by the 15th of the next month.
  • Semi-weekly: You deposit your employer taxes for Wednesday, Thursday, and Friday by the following Wednesday. Or you deposit your taxes for Saturday, Sunday, Monday, and Tuesday by the following Friday.

The IRS also has a "Next-Day Deposit Rule," where you must deposit your taxes by the next business day if you get more than $100,000 in taxes during a monthly or semi-weekly deposit period.

How do you know which deposit schedule to use?

Your deposit schedule is based on your total tax liability reported on Form 941 (or on forms 943, 944, or 945 if they apply to you). You can get more information about the lookback period and how to determine your deposit schedule on the forms or in Publication 15.

9. Form 944: Employer's Annual Federal Tax Return

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: Jan. 31

Form 944 is meant for very small businesses with federal income and FICA taxes of $1,000 or less each year. Instead of filing four quarterly 941 forms, they may file a single annual Form 944. However, they need to get permission from the federal agency first.

The deadline for filing Form 944 is Jan. 31. 

Similar to Form 941, your Form 944 total should equal the total listed on your W-3, the combined total of all your W-2s. If not, the Internal Revenue Service may come knocking.

10. Form 1095-B: Health Coverage

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: Feb. 28 (mailing) or March 31 (e-file)

The Affordable Care Act (ACA) requires that you send employees proof of minimum essential health care coverage. If you have less than 50 employees and provide a self-insured health plan to your employees, you'll need to send out Form 1095-B.

Form 1095-B goes to your employees and the IRS. It outlines details such as:

  • Health insurance coverage
  • Insurance provider
  • Coverage dates
  • Individuals covered

Self-insured basically means that you ultimately foot the bill for your employee's health insurance claims. A health insurance carrier will administer the plan, but you pay the bills. 

However, if you offer health insurance to your employees but it isn't a self-insured plan, your insurance carrier becomes the provider and sends the forms out themselves. 

You must mail Form 1095-B to each of your employees by Jan. 31 and to Uncle Sam by Feb. 28. If you need a little more time, you can file electronically with the IRS to push the deadline to March 31.

11. Form 1094-B: Transmittal of Health Coverage Information Returns

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: Feb. 28 (mailing) or March 31 (e-file)

Form 1094-B is a brief form acting as the TL;DR cover sheet of 1095-B forms for the IRS. You (or the insurance provider if the plan isn't self-insured) should only submit this form to the Internal Revenue Service, not your employees.

The information added on 1094-B includes: 

  • The insurer's name
  • Total number of Form 1095-Bs the insurer is sending to the Internal Revenue Service
  • Name and phone number of the person the federal agency can contact with questions about the forms

Since you'll be submitting Form 1094-B and Form 1095-B together, the deadline for submission is the same—Feb. 28 if you're mailing the form to the federal agency or March 31 if you're sending it as an e-file.

12. Form 1095-C: Employer-Provided Health Insurance Offer and Coverage

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: Feb. 28 (mailing) or March 31 (e-file)

Employers categorized as Applicable Large Employers (ALE) for the ACA file Form 1095-C instead of Form 1095-B.

You are an ALE if you have 50 or more full-time (or full-time equivalent) employees. The ACA defines a full-time employee as an employee who works more than 30 hours per week or 130 hours per month. 

The employer's mandate of the ACA requires ALEs to offer health insurance to at least 95% of their full-time employees. Form 1095-C helps Uncle Sam keep tabs on the ALEs. 

You must mail the Form 1095-Cs to the IRS by Feb. 28. If you prefer to e-file with the federal agency, it has to be done by March 31.

Additionally, you must also send Form 1095-Cs to your full-time employees and part-time workers (who enroll in your health plan) by March 2.

13. Form 1094-C: Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns

Who submits it: Employer

Sent to: Internal Revenue Service

Deadline: Feb. 28 (mailing) or March 31 (e-file)

Form 1094-C summarizes your Form 1095-Cs, and you only send it to the Internal Revenue Service, not your employees.

Form 1094-C includes:

  • Employer information, including employer identification number, address, and phone number
  • Total number of Form 1095-Cs sent to the federal agency
  • Total number of employees
  • Contact details in case the IRS has any questions about the forms

Since you'll also be submitting Form 1094-C and Form 1095-C together, the deadline for submission is the same—Feb. 28 if you're mailing the form to the federal agency or March 31 if you're sending it as an e-file.

What Information Do Employers Need for Payroll?

As an employer, you need the information below to fill out payroll forms and run payroll.

Employee Social Security Number (SSN)

An SSN is a unique number the Social Security Administration (SSA) issues to U.S. citizens and other residents to determine an employee's eligibility for certain government services and social security benefits.

SSNs provide Uncle Sam with a way to track details of salary payments for each employee. They also show the FICA tax withholdings for employees' Medicare and Social Security contributions.

Federal Employer Identification Number

The Federal Employer Identification Number (EIN) is a unique number the IRS assigns to most businesses in the United States to record their tax payments. It's also called a business tax ID.

If you operate as a sole proprietorship or a single-person LLC without excise tax liabilities, you can use your Social Security Number (SSN) as your business tax ID. Excise taxes are taxes on specific goods and services. For example, fuel and tobacco taxes.

Otherwise, you can apply for an EIN online.

State/Local Tax ID Number

A state tax ID number, also called a state EIN, is the state version of the federal EIN. It's your business's tax number for the state.

The process of getting a state EIN may vary by state. You'll have to check with your state government for specific details. You may need state EINs for each state you operate in.

State Unemployment ID Number

The state unemployment ID number is another tax number you'll get from each state you operate in. Each state assigns you a state unemployment ID number to track what you owe and pay under the State Unemployment Tax Act (SUTA). 

These payroll taxes are deposited to a state unemployment fund, which pays out short-term benefits to workers who've lost their jobs due to qualifying events.

Different states have different names for SUTA, and you may hear this tax referred to as: 

  • State Unemployment Insurance tax (SUI tax)
  • Reemployment tax
  • Unemployment benefit tax

Department of Labor (DOL) Records

The DOL requires employers to track their employees' payroll details, such as: 

Having all of this information on hand helps you if the DOL audits your company to determine if you're following labor laws. You can always check your state's labor laws through the DOL website.

Gathering all this information from each employee might seem like a drag. However, the IRS and the states have ready-made forms you can use to get it—namely, Federal W-4s and State withholding certificates. So, make sure to send those out and collect all the info you need.

Have a Stress-Free Tax Season

Now that you know more about the payroll tax forms every employer needs to be aware of, you're a step closer to becoming your office's go-to person for payroll questions. 

We know keeping up with changing IRS forms and requirements can be challenging. But it'll eventually become routine, and you'll be the one explaining it to others. So now that you know all there is to know about payroll forms, all that's left to do? Mark your calendar for when they're due!

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