Form 941: Employer’s Quarterly Federal Tax Return

Form 941 contains several lines used to report payroll information, employment taxes, adjustments, deposits, and the amount due or overpaid. The information should generally be gathered from the employer’s payroll records for the applicable reporting period.

The basic process is to gather the required payroll information, enter the applicable amounts, calculate the employment taxes, account for applicable payments or deposits, and review the completed form before submitting it. Employers should keep supporting records for the information reported on the return.

Section 1

Enter the employer’s identifying information and applicable reporting information. This generally includes information such as the employer’s name, employer identification number, business address, and reporting period.

The information should be reviewed carefully to make sure it is accurate and consistent with the employer’s federal tax and payroll records.

Section 2

Report the applicable employee and wage information for the reporting period. Payroll records are generally used to determine the number of employees and the wage amounts that are reported.

Employers should review their payroll records before entering these amounts to help ensure that the information reported on Form 941 is complete and accurate.

Section 3

Report the amount of federal income tax withheld from employee wages for the applicable reporting period. The amount should generally be based on the employer’s payroll records.

Employers should compare the amount being reported with their payroll records to help identify potential differences before completing the return.

Section 4

Report the applicable Social Security and Medicare wages and taxes. These amounts are generally determined using the employer’s payroll records and applicable employment tax calculations.

The amounts should be reviewed carefully because Social Security and Medicare reporting can affect the overall employment tax calculation shown on Form 941.

Section 5

Certain payroll or employment tax adjustments may apply to an employer’s Form 941. Only adjustments that apply to the employer’s circumstances should be included on the return.

Employers should maintain records supporting any adjustments reported on Form 941. If an adjustment does not apply, it generally should not be included simply to complete a section.

Section 6

Report applicable employment tax deposits and payments for the reporting period. The amounts reported should generally agree with the employer’s payroll, deposit, and payment records.

Reviewing deposits and payments before filing can help prevent differences between the amounts reported on Form 941 and the employer’s records.

Section 7

The completed calculations determine whether the employer has a balance due or an overpayment. The applicable amounts should be reviewed to make sure the calculations are complete and accurate.

Employers should compare the final figures with their payroll and payment records before submitting the return. Any applicable amount due should be handled according to the employer’s filing and payment requirements.

Section 8

Review the entire return for accuracy and completeness before submitting Form 941. Check the employer information, reporting period, payroll amounts, taxes, adjustments, deposits, payments, and final calculations.

The appropriate person should sign the return when a signature is required. Employers should also keep a copy of the completed return and supporting payroll records for their records.

Final Review

Review Form 941 after completing all applicable sections. Check the employer information, reporting period, employee information, wages, federal income tax withheld, Social Security and Medicare taxes, adjustments, deposits, payments, and final amount.

A final review can help identify calculation or reporting errors before the return is submitted. Employers should retain Form 941 and supporting payroll records with their employment tax records.