The monthly and semiweekly deposit schedule is used to describe the due dates for depositing employment tax liabilities with the IRS. You need to deposit these funds with the IRS in a timely fashion when you withhold from your payroll checks the:
- FICA tax
- Employee income tax
The different deposit schedules let you know the dates for these deposits (below), as well as the penalties for failure to deposit.
As an employer or business accountant responsible for calculating, withholding, and depositing payroll tax liabilities, it is essential that you have the correct employer classification and deposit schedule. Otherwise, you are all but sure to incur unnecessary accounting expenses or, worse, 941 late payment penalties for failure to deposit in a timely manner.
Advanced Micro Solutions Payroll Software is part of an affordable and larger customizable system that can help to keep you organized and on track with each deposit and deadline.
What are the Basic Concepts Behind Monthly vs. Semiweekly Scheduling?
It does not hurt to review the basic concepts behind labels so that you have a better working knowledge of certain designations. For instance:
- An employer’s status may change from one filing year to the next
- Independent accounting professionals may serve business clients in both scheduling categories
Do not be fooled into thinking that these deposit schedules have anything to do with whether the employer uses a weekly, bimonthly, or monthly pay schedule. A monthly deposit schedule is used to:
- Refer to employers with more modest employment tax liabilities for which the IRS deems monthly deposits sufficient
- Help reduce the bookkeeping requirements of new and small businesses
If there are larger payroll sums, the IRS wants these funds available sooner rather than later. If you issue payroll checks that incur employment taxes, the withholding funds must be deposited in three to seven days, depending on the applicable schedule.
For “business days,” these deposit deadlines fall on Wednesdays and Fridays.
That explains the “semiweekly” scheduling term.
The $100,000 Next-Day Deposit Rule
Understanding the terminology between monthly and semiweekly deposit schedules can also help you understand why the IRS instituted something called the “$100,000 Next-Day Deposit Rule.”
If an employer makes payroll payments that result in $100,000 in employment tax liability within a single deposit period, the funds must be deposited on the next business day.
If you think the rule may apply to your business, we strongly recommend that you review the entire rule in Section 11 of Publication 15. If the rule applies to you, the employer:
- Immediately becomes a semiweekly schedule depositor
- Remains a semiweekly schedule depositor for the rest of that year
- Is a semiweekly schedule depositor for the following calendar year
How to Use the Lookback Period to Determine an Employer’s Deposit Schedule
So, how do you know whether an employer is a monthly or semiweekly schedule depositor? Under most normal business situations, you use the Lookback Period. The IRS tries to make the determination on whether it is reasonable to expect an employer to comply with the more frequent deposit schedule based on their business and employment tax history. The Lookback Period is designed to give employers some heads-up that a change is coming.
Here’s how it works:
| Tax Liability | Type of Depositor |
| Employer has more than $50,000 of employment tax liability | Semiweekly schedule depositor |
| Employer has $50,000 or less of tax liability | Monthly schedule depositor |
You can find the complete rules in Section 11 of Publication 15. For 941 Filers with quarterly payroll tax records, the 2026 Lookback Period was July 1, 2024 – June 30, 2025.
- Note: Converting to a quarterly Form 941 Filer from an annual Form 944 Filer? Use the earlier of the two calendar years when available. In other words, the Lookback Period for 2026 filers defaults to the January-December 2024 calendar year when the quarterly numbers are not applicable.
What is the Monthly and Semiweekly Deposit Schedule?
Once you have determined the schedule depositor rules that apply to your business, you will naturally want to know what the deposit deadlines are:
The Monthly Deposit Schedule:
- The 15th of every month for which employment tax liabilities were accrued
- You must calculate and deposit all of the applicable tax liability for January by Feb. 15
- For business holidays, the due date is forwarded to the next business day
The Semiweekly Deposit Schedule:
- For payments made on a Wednesday, Thursday, or Friday, the tax deposit is due on the following Wednesday
- For payments made on a Saturday, Sunday, Monday, or Tuesday, the tax deposit is due on the following Friday
- For business holidays, the due date is forwarded to the next business day
People Also Ask
- How much does direct deposit cost a business? – It will depend on the specific software, but the key is to find a program that does not have hidden or tons of extra fees.
- What determines an employer’s payroll tax deposit schedule? – Once you determine the Lookback Period, establish that period’s total tax liability.
Payroll Software and Form 941 Support from AMS
No matter what type of deposit schedule your business is on, you will want versatile and reliable software support. AMS Payroll includes a powerful suite of features that includes Form 941 and e-file support, among other federal and state-based payroll filings.
Our software makes it easy to set up payer and payee account information. Moving forward, it also includes:
- Automatic payroll calculations
- Multiple paycheck options
- Easy data transfers to your quarterly and end-of-year filing forms
Our modular products and pricing delivers better solutions at better prices for clients. Download our free 1099-etc Demo software and get started by inputting your actual data.