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IRS Forms 941 [A Must Read For Employers] | Internal Revenue Service

Feature | IRS Forms 941 [A Must Read For Employers] | Internal Revenue Service | income tax

Business with employees must file IRS Forms 941  (Employer’s Quarterly Federal Tax Return). Most companies need to provide the IRS with comprehensive documentation about their revenue. Businesses also need to report the taxes they pay on behalf of their employees. Like IRS 1040a for individuals, all IRS tax forms need to meet the specific actions of the business. The information on Form 941 verifies the details submitted on Form 1040ez or other versions of IRS 1040a.

What Employers Need To Know For IRS Forms 941

What Does Form 941 Do?

What Does Form 941 Do? | IRS Forms 941 [A Must Read For Employers] | Internal Revenue Service | tax

The Employer’s Quarterly Federal Tax Return is a document a business need to report income taxes. It also allows for reporting social security tax and any Medicare tax. These are funds the company withholds from the employee’s paycheck. It applies to the previous year’s withholdings.

In most situations, businesses must follow IRS rules. This includes using a part of the employee’s paycheck for Social Security and Medicare costs aside from income taxes. These are funds paid by the employer to the employee. Instead of sending them to the employee, the company sends them to the IRS.

Do You Qualify For IRS Back Tax Relief? Take The Quiz Now!

Form 941 also allows the employer to pay its part of the Medicare and Social Security tax. Under United States tax laws, employers must pay a part of these taxes. These are not the funds paid to employees, but rather the part the employer should be paying.

This form, then, allows for the business to report what the employee paid (out of his or her paycheck) and what the company paid. The IRS verifies this information. It may make adjustments to any information that does not follow federal guidelines.

Who Needs to File This Form?

Business owners must file IRS Forms 941 if they have employees. It is possible to file this form annually in some situations. Unlike IRS forms 1040ez or IRS Schedule A forms, most employers will need to file this form on a quarterly basis. Most often, employers file this form when submitting the employees’ Medicare and Social Security taxes. But, employers with withholding liabilities and payroll taxes under $1,000 may not need to file this form quarterly. Instead, they can file it on an annual basis through Form 944.

In this situation, any person or any business that pays out wages must complete and file this form. The IRS still requires the business to continue filing IRS Forms 94 even in the absence of employees. Some exceptions do apply, such as the business hiring seasonal employees that do not earn wages for one or more quarters. It also applies to those in the agricultural sector. Household employees, such as nannies or house cleaners, also apply.

How to Complete Form 941

How to Complete Form 941 | IRS Forms 941 [A Must Read For Employers] | Internal Revenue Service | irs forms 941

Like following IRS form 1040 instructions, Form 941 also has information available for businesses to follow. This form represents only federal reporting. If, for example, a company is in California, it will need to complete local tax forms on top of federal forms.

Do You Qualify For IRS Back Tax Relief? Take The Quiz Now!

To complete Form 941, businesses will need to report the total wages paid to the employee. The amount of taxes withheld from the employee’s paycheck should be noted as well. The form also requires the number of employed individuals during the filing period. It is important to gather all wage information. This includes any taxable tips the employee received and reported. Use payroll records to document payments withheld and sent to the IRS for accuracy.

At the time of this writing, businesses should withhold 6.2% from an employee’s wages to account for Social Security insurance payments. It must also include 1.45% of funds withheld for Medicare tax payments. This can change from year to year. It also does not include any state taxes withheld by the employer.

It is important to file these documents on time. Form 941 requires four annual filings. They are due April 30, July 31, October 31, and January 31 for the previous three months.

Order IRS Forms

Order IRS Forms | IRS Forms 941 [A Must Read For Employers] | Internal Revenue Service | income tax

For those who need Form 941, IRS forms w-4 or IRS forms w-9, all are available at the IRS website. It is possible to order all forms necessary for gathering and reporting income tax and other payments online.

Business owners will need to monitor their tax filing for accuracy. Form 941 is just one of several forms companies must file.

 

Need a more visual guide in filling out IRS Form 941? Watch the video below.

If you’re a small business owner, filing IRS Form 941 is an important part of your federal tax reports. But it doesn’t need to be a daunting task. Just follow the instructions in this article or on the IRS website.

Have you filed the IRS Form 941 before? Share your experience below.

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