Background

In my practice helping small businesses and payroll teams for over 15 years, I’ve seen that switching from paper checks to EFTPS cuts errors, missed deposits, and penalty notices. The IRS designed EFTPS to make federal tax deposits predictable and auditable (IRS: Electronic Federal Tax Payment System (EFTPS) — https://www.irs.gov/payments/electronic-federal-tax-payment-system-eftps).

How EFTPS works (step-by-step)

  • Enroll: Go to EFTPS (eftps.gov) and enroll using your EIN or SSN and bank-account information. After enrollment, the system sends a PIN by mail—allow up to 7 business days to receive and activate it (IRS EFTPS enrollment instructions).
  • Set up payees and payment types: Add the business EIN, select the tax form/type (for example, FUTA, Form 941 payroll deposits, or estimated tax), and link your bank account.
  • Schedule payments: You can schedule recurring or one-time payments. To ensure the IRS treats a payment as on-time, schedule it early enough so EFTPS processes it by the due date—payments must be scheduled by 8:00 p.m. Eastern Time the business day before the tax due date (IRS EFTPS guidance).
  • Confirm and save records: EFTPS provides a confirmation number for every payment; keep confirmations with payroll records.

Who should use EFTPS

  • Employers of every size who must deposit federal employment taxes (withholding, Social Security, Medicare, FUTA).
  • Self-employed taxpayers and others who make estimated federal tax payments. Using EFTPS centralizes deposits and reduces reliance on paper forms or manual bank transfers.

Deposit schedules—key rules (summary)

  • Monthly vs. semiweekly: An employer’s deposit schedule (monthly or semiweekly) is based on total tax liability during the IRS lookback period. Generally, employers who accumulated $50,000 or less are monthly depositors; those with more are semiweekly depositors. The IRS publishes the official lookback rules and dates—always confirm your status on IRS deposit guidance (IRS: Federal Tax Deposit Requirements — https://www.irs.gov/businesses/small-businesses-self-employed/federal-tax-deposit-requirements).
  • Small-amount exception: If your total employment tax for a quarter is $2,500 or less, you may be able to pay with your quarterly Form 941 instead of making deposits. Verify this exception applies before relying on it.
  • Estimated and income taxes: Estimated tax payments follow quarterly due dates; individual income tax payments can be made via EFTPS or other IRS electronic tools.

Practical example

A retail client I advised had seasonal payroll spikes and previously missed semiweekly deposits during peak weeks. After enrolling in EFTPS and scheduling payments ahead of paydays, the client eliminated late deposits and interest charges. The confirmations from EFTPS also simplified month-end reconciliations.

Common mistakes and how to avoid them

  • Missing the scheduling cutoff: Don’t wait until the last hour—EFTPS requires scheduling by the deadline the business day before due date (8:00 p.m. ET).
  • Using the wrong deposit schedule: Confirm whether you’re a monthly or semiweekly depositor based on the lookback period; wrong timing triggers penalties.
  • Losing confirmation numbers: Store confirmation emails or print/save the EFTPS receipt for each deposit.

Professional tips

  1. Enroll well before your first payment is due—pin mail can take several business days.
  2. Reconcile EFTPS confirmation numbers against payroll reports weekly.
  3. Put calendar reminders one day earlier than the IRS deadline to allow time for corrections.
  4. Use the EFTPS test and help pages or the IRS Business Services help line for setup questions (IRS EFTPS pages).

Related resources (internal links)

Frequently asked items (short answers)

  • When must I schedule an EFTPS payment? Schedule by 8:00 p.m. Eastern Time the business day before the due date for the IRS to consider it on time (IRS EFTPS guidance).
  • Can EFTPS handle all federal tax types? EFTPS supports most federal tax deposits and payments, including employment taxes, estimated taxes, and corporate tax deposits. Check the EFTPS site for supported payment types.

Legal and professional disclaimer

This article is educational and not individualized tax advice. For guidance specific to your business, consult a qualified tax professional or the IRS directly (IRS publications and EFTPS help pages).

Authoritative sources