If you made your deposits by FTD coupon or by using EFTPS in a state other than that shown in your address on Form 941, enter the state code for the state where you made deposits in the box provided in the upper left corner of the form. Use the Postal Service two-letter state abbreviation as the state code. Enter the code “MU” in the state code box if you deposit in more than one other state. If you deposit in the same state as shown in your address, do not make an entry in this box.

Check the box and enter the date final wages were paid in the space provided if you do not have to file Form 941 in the future. See also Final Return on page 1.

Check this box if you are a seasonal employer described on page 1.

Enter the number of employees on your payroll during the pay period including March 12 (on the January-March calendar quarter return only). Do not include household employees, persons who received no pay during the pay period, pensioners, or members of the Armed Forces. An entry of 250 or more on line 1 indicates that you must file Forms W-2 electronically or on magnetic media. Call the SSA at 1-800-772-6270 or access the SSA website at www.socialsecurity.gov/employer for more information on electronic or magnetic media filing requirements.

Enter the total of all wages paid, tips reported, taxable fringe benefits provided, and other compensation paid to your employees, even if you do not have to withhold income or social security and Medicare taxes on it.

Do not include supplemental unemployment compensation benefits, even if you withheld income tax on them. Do not include contributions to employee plans that are excluded from the employee's wages (e.g., section 401(k) and 125 plans).

If you get timely notice from your insurance carrier concerning the amount of third-party sick pay that it paid to your employees, include the sick pay on line 2. If you are an insurance company, do not include sick pay that you paid to policyholders' employees here if you gave the policyholders timely notice of the payments. See Pub. 15-A, Employer's Supplemental Tax Guide, for details.

Enter the income tax that you withheld on wages, tips, taxable fringe benefits, and supplemental unemployment compensation benefits. An insurance company should enter the income tax that it withheld on third-party sick pay here.

Use line 4 to correct errors in income tax withheld from wages paid in earlier quarters of the same calendar year. You may not adjust or claim a refund or credit for any overpayment of income tax that you withheld or deducted from an employee in a prior year. This is because the employee uses the amount shown on Form W-2 as a payment when filing his or her income tax return. Because any amount shown on line 4 increases or decreases your tax liability, the adjustment must be taken into account on line 17, Monthly Summary of Federal Tax Liability, or on Schedule B (Form 941), Employer's Record of Federal Tax Liability. For details on how to report adjustments on the record of Federal tax liability, see the instructions for line 17 (on page 4) or the instructions for Schedule B (Form 941). Explain any adjustments on Form 941c, Supporting Statement To Correct Information, or an equivalent statement. See section 13 of Circular E (Pub. 15).

Enter the total wages subject to social security tax that you paid to your employees during the quarter. Also include any sick pay and taxable fringe benefits subject to social security tax. See section 5 of Circular E (Pub. 15) for information on types of wages subject to social security tax. Enter the amount before deductions. Do not include tips on this line. Stop reporting an employee's wages (including tips) after he or she reaches $87,000 for 2003. However, continue to withhold income and Medicare tax for the whole year on wages and tips even when the social security wage base of $87,000 is reached. See the Line 7a instructions for Medicare tax. If none of the payments are subject to social security tax, check the box in line 8.

Enter all tips that your employees reported during the quarter until tips and wages for an employee reach $87,000 in 2003. Do this even if you were not able to withhold the employee tax (6.2%). See the Line 9 instructions for the adjustment for uncollected employee's share of social security tax on tips.

An employee must report to you cash tips, including tips you paid the employee for charge customers, totaling $20 or more in a month by the 10th of the next month. The employee may use Form 4070, Employee's Report of Tips to Employer, or submit a written statement.

Do not include allocated tips on this line. Instead, report them on Form 8027, Employer's Annual Information Return of Tip Income and Allocated Tips. Allocated tips are not reportable on Form 941 and are not subject to withholding of income, social security, or Medicare tax.

Report all wages and tips subject to Medicare tax. Also include any sick pay and taxable fringe benefits subject to Medicare tax. See section 5 of Circular E (Pub. 15) for information on types of wages subject to Medicare tax. There is no limit on the amount of wages subject to Medicare tax. If none of the payments are subject to Medicare tax, check the box in line 8.

Include all tips that your employees reported during the quarter, even if you were not able to withhold the employee's share of Medicare tax (1.45%). However, see the Line 9 instructions below.

Enter any advance EIC payments that you made to your employees. Your eligible employees may elect to receive part of the EIC as an advance payment. Eligible employees must expect to have a qualifying child and must give you a completed Form W-5 stating that they qualify for the EIC. Once the employee gives you a signed and completed Form W-5, you must make the appropriate advance EIC payments. Advance EIC payments are generally made from withheld income tax and employee and employer social security and Medicare taxes. See section 10 of Circular E (Pub. 15) and Pub. 596.

If the amount of your advance EIC payments exceeds your total taxes (line 11) for the quarter, you may claim a refund of the overpayment or elect to have the credit applied to your return for the next quarter. Provide a statement with your return identifying the amount of excess payment(s) and the pay period(s) in which it was paid. See section 10 of Circular E (Pub. 15).

You do not have to pay if line 15 is under $1. Generally, you should show a balance due on line 15 only if your net tax liability for the quarter (line 13) is less than $2,500. However, see section 11 of Circular E
(Pub. 15) regarding payments made under the accuracy of deposits rule.

If you fail to make deposits as required and instead pay the taxes with Form 941, you may be subject to a penalty.

If you deposited more than the correct amount for a quarter, you can have the overpayment refunded or applied to your next return by checking the appropriate box. If you do not check either box, your overpayment will be applied to your next return. The IRS may apply your overpayment to any past due tax account under your EIN. If line 16 is under $1, the amount will be refunded or applied to your next return only on written request.

Complete line 17 only if you were a monthly schedule depositor for the entire quarter and line 13 is $2,500 or more. (See section 11 of Circular E (Pub. 15) for details on the deposit rules.) You are a monthly schedule depositor for the calendar year if the total amount of your Form 941 taxes (line 11) reported for the lookback period is not more than $50,000.

The lookback period is the four consecutive quarters ending on June 30 of the prior year. For 2003, the lookback period begins July 1, 2001, and ends June 30, 2002.

If you were a semiweekly schedule depositor during any part of the quarter, do not complete columns (a) through (d) of line 17. Instead, complete Schedule B (Form 941).

The return may also be signed by a duly authorized agent of the taxpayer if a valid power of attorney has been filed.