Why My Business Has To Submit Form 941 & 940 to the IRS

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Filing For Payroll Taxes Using Forms&  940 941? Here’s How and When To Do It

Payroll reporting time seems to come up quickly on a regular basis. Form 941 is the primary payroll report and has to be delivered by the end of January, April, July and October. However, there is a bit more involved in the payroll form.

  • Forms 940 & 941, what is it exactly?
  • What is the best way to complete this form?
  • How should you submit it?
  • How do you get an extra 10 days after the due date?

We will now take a closer look:

The Reason Why My Business Has To Submit Form 941 & 940 to the IRS 

What you have been paying your employees? Have you been keeping back federal income taxes, Medicare and Social Security taxes?

The IRS requires that you report your payroll 940 withholdings, pay the required amounts along with the payments required by your business.

The Employer’s Quarterly Federal Tax Form – Form 941

Employers use Form 941 to report the amount of federal income and FICA (Medicare and Social Security) taxes that are being withheld, the amount of withholding payments by the employer as well as how much is owed to the IRS.

The following quarterly reports and calculations are included in Form 941:

  • Employee paychecks amounts being withheld for FICA and federal income taxes are included in reports
  • Calculation of taxes owed from social security taxable income along with Medicare wages, from both employer and employees
  • Sick pay and tips are adjusted for
  • How much taxes is owed by the employer
  • How much has been previously paid by the employer via semi-weekly or monthly payments is dependent on payroll size and the number of employees
  • All under or over payments

IRS Form 941 & 940 Reminders

  • Taxes being withheld from employee’s pay for Medicare for high-income earners are included on Form 941.
  • Note that the Social Security rate for employers and employees is currently 6.2%. Every year the limit changes for Social Security wages and is the maximum yearly pay required for Social Security taxes. The 1.45% tax rate for Medicare for both employer and employee has not changed since 2013. Medicare taxes are not based on wages.
  • The COBRA Premium assistance cannot be claimed on Form 941 if the effective tax period falls after December 31, 2013.

Below are the current IRS Form 914 along with the relevant instructions.

Due Dates for Form 941 & 940

Form 941 has to be submitted quarterly at the end of the month ending the quarter, according to the following timeline for 2015:

  • For instance, quarter one ends on March 31 and Form 941 has to be submitted by April 30
  • Quarter two ends on June 30 and has to be submitted by July 31
  • Quarter three ends on September 30 and must be submitted by October 31
  • Quarter four ends on December 31 and the submission deadline is January 31, 2016.

For due dates that fall on holidays or weekends, the submission deadline is the next business day. For instance, say the deadline for a given year is July 31 and it falls on a Saturday, the payment due date will be moved to Monday, August 2.

Once you have paid all your payroll tax deposits for the quarter and before the deadline, you will get an extra 10 days to submit your Form 941 after the previous deadline for the quarter.

Below are the filing dates for the 10-day extension if you meet the criteria:

  • Quarter one which ends on March 30 must be submitted by May 10.
  • Quarter two ends on June 30 and the submission deadline is August 10.
  • The third quarter ends on September 30 and the submission deadline is November 10.
  • The fourth quarter ends on December 31 and must be submitted by February 10.

The Best Way to Submit Form 941

Electronic submission via Federal E-File is the best way to submit Form 941 online. Any outstanding payments can also be submitted electronically via software for tax preparation or via a tax expert. Find out more about filing Form 941.

Completing Form 941

The calculation totals for Form 941 include:

  • Amount of employees as well as total payment for the reported period
  • Withholding total from employee payments for the period
  • Social Security and Medicare taxable income for the period
  • Calculation total for Social Security and Medicare income
  • Tips, sick pay, group-term life insurance and any additional adjustments

Total taxes are a requirement for the form along with total deposits for the period. If there is a difference between the amount of taxes due and total payments, the outstanding balance has to be settled.

Learn more about the required steps to complete Form 941.

Learn more about Form 941 and 940, such as preparation details, submission deadlines and the best way to send in updates: Click here to learn more about Form 941.


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