Form 941 Tips

Nobody likes paying taxes, and the process is sometimes confusing, cumbersome, and seemingly capricious; it is the IRS. The number of forms required to be filled out by business owners can be overwhelming. Here at VARC Solutions, our staff of QuickBooks ProAdvisors assists our clients by getting them set up with a proper QuickBooks file, which will help them complete tax filings in a timely manner. The team also performs regular ongoing bookkeeping for many clients.

One filing that must be made quarterly by many businesses is Form 941 – Employer’s Quarterly Federal Tax Return. This is a pretty straightforward form that reports to the IRS income, Federal Withholdings, Social Security tax, and Medicare tax withheld from employee’s paychecks. In addition, businesses use Form 941 to pay Federal Withholdings and the employer portion of Social Security and Medicare taxes to the IRS.

Business owners that keep their QuickBooks file up-to-date, or use a service that performs this function, will find that QuickBooks has a great built-in feature for Form 941. QuickBooks will fill out the form for you. Keep in mind that your QuickBooks file must be current for the data to be valid.

A few important items to remember when getting ready to file Form 941 with the IRS

Ask yourself, are you required to pay quarterly taxes, and if so, how do you make this payment? Do you write the IRS a check or do you pay by EFTPS? If you write a hard check to the IRS when you file Form 941, make sure you also include Form 941-V – Payment Voucher. This will greatly simplify the process for the IRS, helping them make sure that your payment is properly credited in a timely fashion; there are filing date deadlines to be met. Keep in mind that there are restrictions on who is allowed to make a payment by check when mailing the IRS Form 941; many businesses are required to make electronic payments via EFTPS.gov. Failure to make your payment correctly and in a timely manner can result in penalties being assessed. And no one likes getting that letter from the IRS. Generally, it is smaller filers that are allowed to make payments that are not via EFT.

Also, keep in mind that where you mail your Form 941 will depend on a couple of factors. First, there are multiple processing centers across the US. The state where your business resides will determine which processing center gets your form. But also note that if you are sending a payment with Form 941, all of this is mailed to a different location than if you make payment via EFT. The mailing addresses are found in the Instructions for Form 941 that QuickBooks will provide for you.

Several other categories of deductible expenses, such as interest on loans, automobile use, and cost of goods sold are available to small business owners. Additional information on these deductions can be found at this IRS webpage, and in Publication 535.

Taxes can be a pain, but they don’t have to be. Contact VARC Solutions if you have questions or need assistance with anything QuickBooks or bookkeeping related. Their nationally recognized ProAdvisor staff can help meet all your QuickBooks and bookkeeping needs.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should always consult a tax, legal, and/or accounting professional if you have questions regarding IRS forms and/or filings.