How the Lookback Rule Sets Your Form 941 Deposit Schedule
A Form 941 filer’s deposit schedule is monthly or semiweekly, set by the lookback rule rather than pay frequency, unless a monthly depositor accumulates $100,000 in a deposit period. The lookback period is the four quarters from July 1 through June 30, measured on Form 941 line 12. A total of $50,000 or less means monthly, and more than $50,000 means semiweekly, per Publication 15 (2026). The window for 2027, July 1, 2025 through June 30, 2026, has closed.
Four quarters of Form 941 liability set your deposit schedule
A Form 941 filer’s schedule comes from the line 12 totals over a four-quarter lookback period, and how often employees are paid does not set it. Per the Instructions for Form 941 (Rev. 03/2026), the employer determines which deposit schedule it must use before each calendar year by applying the lookback rule. A weekly payroll does not by itself make you semiweekly, and a monthly payroll does not by itself make you monthly. You do not elect a schedule. The rule decides, and your job is to apply it correctly before the year begins.
The figure that counts is Form 941 line 12, total taxes after adjustments and nonrefundable credits, per the Form 941 instructions. That total includes federal income tax withheld and both the employer and employee shares of social security and Medicare tax.
The lookback period begins July 1 and ends June 30. For 2026, the four quarters in the Publication 15 (2026) table are July 1 through September 30, 2024; October 1 through December 31, 2024; January 1 through March 31, 2025; and April 1 through June 30, 2025. Add the four line 12 totals. A sum of $50,000 or less makes you a monthly schedule depositor, and a sum of more than $50,000 makes you a semiweekly schedule depositor. A total of exactly $50,000 is monthly.
Under the Publication 15 (2026) thresholds, consider two hypothetical employers using the 2027 window, which covers Q3 2025, Q4 2025, Q1 2026, and Q2 2026. Assume both pay employees every week and neither accumulates $100,000 in a deposit period. Employer A reports $12,100, $12,600, $12,500, and $12,600 on line 12, a total of $49,800, so it is a monthly depositor for 2027. Employer B reports $12,300, $12,700, $12,600, and $12,600, a total of $50,200, so it is semiweekly for 2027. The $400 gap puts two similar payrolls on different calendars. In 2027, Employer A follows the monthly due dates and Employer B follows the Wednesday and Friday due dates. Both totals come from a window that closed on June 30, 2026, so payrolls run after that date do not change either employer’s 2027 lookback result.
The lookback window closes June 30 and the schedule starts January 1
Each calendar year’s schedule comes from the four quarters ending the prior June 30, so the quarters ending June 30, 2026 already settle the 2027 lookback result. As of October 2026, the 2026 window runs July 1, 2024 through June 30, 2025, and the 2027 window runs July 1, 2025 through June 30, 2026, per the Instructions for Form 941 (Rev. 03/2026). The 2027 quarters are July 1 through September 30, 2025; October 1 through December 31, 2025; January 1 through March 31, 2026; and April 1 through June 30, 2026.
The table below separates what moves a schedule from what does not, per Publication 15 (2026) and the Instructions for Form 941 (Rev. 03/2026).
Factor
Effect on a Form 941 filer’s schedule
How often you pay employees
None, because the schedule is not set by pay frequency
Form 941-X corrections
None, because Form 941-X corrections do not change lookback amounts
Line 12 totals for the four quarters ending June 30
Set the next calendar year’s schedule, with $50,000 or less monthly and more than $50,000 semiweekly
Liability after June 30, 2026
None on the 2027 lookback result, because it is not part of the 2027 window
$100,000 accumulating on any day
Requires a next-business-day deposit and makes a monthly depositor semiweekly for at least the rest of that year and the following year
Of the five rows, only the $100,000 row can change a schedule during a calendar year, per Publication 15 (2026), so a busy quarter after June 30, 2026 changes the 2027 schedule only if accumulated taxes in a deposit period reach $100,000.
How monthly and semiweekly due dates fall on the calendar
A monthly depositor’s taxes on payments made during a month are due by the 15th of the following month, and a semiweekly depositor’s taxes are due the following Wednesday or Friday, depending on the payday, per Publication 15 (2026). Payments made Wednesday, Thursday, or Friday are due the following Wednesday. Payments made Saturday, Sunday, Monday, or Tuesday are due the following Friday.
Semiweekly depositors get at least three business days after the period closes, plus one extra day for each legal holiday among those three weekdays. A deposit due on a non-business day is timely if made by the close of the next business day, and a business day is any day other than a Saturday, Sunday, or legal holiday. For deposit purposes, only District of Columbia legal holidays count, and statewide holidays do not, per Publication 15 (2026). The 2026 list is January 1, January 19, February 16, April 16, May 25, June 19, July 3 (observed), September 7, October 12, November 11, November 26, and December 25.
These hypothetical paydays show how the rules produce specific dates as of October 2026.
Hypothetical payday
Deposit due
Semiweekly depositor, wages paid Wednesday, November 25, 2026
Wednesday, December 2, 2026 (Thanksgiving, Thursday, November 26, falls inside the deposit period, so it adds no day)
Semiweekly depositor, wages paid Saturday, November 28, 2026
Friday, December 4, 2026
Monthly depositor, January 2027 wages
Tuesday, February 16, 2027, because Monday, February 15, 2027 is Washington’s Birthday
Washington’s Birthday is the third Monday in February under D.C. Code § 28-2701, which makes it Monday, February 15, 2027, per OPM’s holiday list.
The failure-to-deposit penalty rises with how late a deposit is, per Publication 15 (2026). The rate is 2% for deposits 1 to 5 days late, 5% for 6 to 15 days late, and 10% for 16 or more days late but before 10 days after the first IRS notice. A required deposit paid directly to the IRS or with the return also draws 10%, and amounts unpaid more than 10 days after the first IRS notice, or on the day notice and demand for immediate payment is received, draw 15%. Days are calendar days counted from the due date, and the tiers are not cumulative, per the IRS failure-to-deposit page.
These are federal rules, and state and local payroll tax deposit schedules are set separately, so confirm those with each state and local tax agency.
The $100,000 rule can start two clocks at once
A deposit is due by the next business day once $100,000 or more in taxes accumulates on any day of a monthly or semiweekly deposit period, whichever schedule you follow, per Publication 15 (2026). The test is applied before reducing liability for nonrefundable credits. Accumulation stops at the end of that day and starts anew the next day, and liabilities do not carry across the end of a deposit period. The deposit period is a calendar month for a monthly depositor, and Wednesday through Friday or Saturday through Tuesday for a semiweekly depositor.
For a monthly depositor, the rule starts two clocks. Clock one is the next-business-day deposit. Clock two is the status change. A monthly depositor becomes semiweekly the next day and stays semiweekly for at least the rest of that calendar year and the following calendar year, per Publication 15 (2026), after which the lookback decides again. A semiweekly depositor is already semiweekly, so the next-day deposit applies and the status stays semiweekly. The rule does not depend on why the liability built up. A large bonus run or a hiring surge counts the same way once accumulated taxes in a deposit period reach $100,000.
An employer that becomes semiweekly mid-quarter files Schedule B (Form 941) for the whole quarter and checks the third box on line 16, per the Instructions for Schedule B (Form 941).
Under Publication 15 (2026), a hypothetical monthly depositor that accumulates $100,000 in taxes on Thursday, November 19, 2026 must deposit by Friday, November 20, 2026. The employer becomes semiweekly on Friday, November 20, 2026, and stays semiweekly through at least December 31, 2027. Because the change falls mid-quarter, the employer files Schedule B for all of the fourth quarter of 2026.
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Frequently asked questions
Do I deposit payroll taxes monthly or quarterly?
A Form 941 filer’s deposit schedule is monthly or semiweekly, while the return itself is filed quarterly. A filer whose line 12 total is less than $2,500 for the current or prior quarter, with no $100,000 next-day deposit obligation in the current quarter, may pay with a timely filed Form 941 instead of depositing, per Publication 15 (2026). Depositing the taxes alone does not report them or relieve the requirement to file a return, per the IRS employment tax due dates page.
Does my deposit schedule change from year to year?
A deposit schedule can change from year to year, because each calendar year’s schedule comes from a new four-quarter lookback ending June 30. Total the four quarters after June 30 and determine the schedule before the calendar year begins, per the Instructions for Form 941 (Rev. 03/2026).
Which lookback period applies if I used to file Form 944?
For 2026, a Form 941 filer that filed Form 944 in 2024 or 2025 uses calendar year 2024 as its lookback period, per the Instructions for Form 941 (Rev. 03/2026). Check the current Form 941 instructions for the period that applies to 2027.
Does a Form 941-X correction change my lookback total?
A Form 941-X correction does not change your lookback total. Publication 15 (2026) says Form 941-X corrections do not change lookback amounts, and Form 941-X is filed separately from Form 941. A corrected quarter therefore does not move you between monthly and semiweekly through the lookback.
How is a new employer’s deposit schedule set?
A new Form 941 filer is a monthly schedule depositor for the first calendar year of the business, because lookback liability before the business started or was acquired is treated as zero. The $100,000 next-day rule still applies, per Publication 15 (2026).
What does the $100,000 rule change for a semiweekly depositor?
A semiweekly depositor must still deposit by the next business day once $100,000 or more accumulates on any day, and its status does not change because it is already semiweekly, per Publication 15 (2026). The status change applies to monthly depositors.
Talk to an expert at Asure
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