How to Complete a Form 941
We are breaking down step by step how to easily file a 941 form with TaxBandits!
Once you’ve signed in to TaxBandits, select “Start New” in the upper right corner:
Select “Form”:
Select Form 941:
Select the business you are filing for, or manually enter the business information. Then click “Save and Continue”
Select the tax year and quarter you are filing for:
While working through the form, TaxBandits will do several of the calculations for you. You will only need to provide information in the yellow fields as it pertains to your business.
If the box is grey, it is either not required or TaxBandits will complete that box for you based on other information you provide on the form.
Completing Part 1: Answer These Questions for This Quarter
Line 1: Number of Employees Who Received Wages, Tips, or Other Compensation
Enter the number of employees on your payroll for the pay period.
Line 2: Wages, Tips, and Other Compensation
Enter amounts on line 2 that would also be included in box 1 of your employees’ Forms W-2. Include sick pay paid by your agent. Also include sick pay paid by a third party that isn’t your agent.
Line 3:Federal Income Tax Withheld From Wages, Tips, and Other Compensation
Enter the federal income tax you withheld (or were required to withhold) from your employees on this quarter’s wages, including qualified sick leave wages, qualified family leave wages, and qualified wages for the employee retention credit.
Line 4: If No Wages, Tips, and Other Compensation Are Subject to Social Security or Medicare Tax. If this question doesn’t apply to you, leave the box blank.
If no wages, tips, and other compensation on line 2 are subject to social security or Medicare tax, check the box on line 4.
Line 5a–5e. Taxable Social Security and Medicare Wages and Tips
5a. Taxable social security wages. Enter the total wages, including qualified sick leave wages and qualified family leave wages
5a(i). Qualified sick leave wages. Enter the qualified taxable (subject to social security tax) sick leave wages you paid to your employees during the quarter
5a(ii). Qualified family leave wages. Enter the qualified taxable (subject to social security tax) family leave wages you paid to your employees during the quarter
5b. Taxable social security tips. Enter all tips your employees reported to you during the quarter until the total of the tips and taxable wages, including wages reported on line 5a, qualified sick leave wages reported on line 5a(i), and qualified family leave wages reported on line 5a(ii)
5c. Taxable Medicare wages & tips. Enter all wages, including qualified sick leave wages, qualified family leave wages, and qualified wages (excluding qualified health plan expenses) for the employee retention credit; tips; sick pay; and taxable fringe benefits that are subject to Medicare tax
5d. Taxable wages & tips subject to Additional Medicare Tax withholding. Enter all wages, including qualified sick leave wages, qualified family leave wages, and qualified wages (excluding qualified health plan expenses) for the employee retention credit; tips; sick pay; and taxable fringe benefits that are subject to Additional Medicare Tax withholding.
5e. Total social security and Medicare taxes. Add the column 2 amounts on lines 5a–5d. Enter the result on line 5e.
5f. Section 3121(q) Notice and Demand—Tax Due on Unreported Tips Enter the tax due from your Section 3121(q) Notice and Demand on line 5f.
Line 6: Total Taxes Before Adjustments
Add the total federal income tax withheld from wages, tips, and other compensation (line 3); the total social security and Medicare taxes before adjustments (line 5e); and any tax due under a Section 3121(q) Notice and Demand (line 5f). Enter the result on line 6.
Line 7:Current quarter’s adjustment for fractions of cents.
Enter adjustments for fractions of cents (due to rounding) relating to the employee share of social security and Medicare taxes withheld.
Line 8: Current quarter’s adjustment for sick pay.
If your third-party payer of sick pay that isn’t your agent transfers the liability for the employer share of the social security and Medicare taxes to you, enter a negative adjustment on line 8 for the employee share of social security and Medicare taxes that were withheld and deposited by your third-party sick pay payer on the sick pay
Line 9:Current quarter’s adjustments for tips and group-term life insurance.
Enter a negative adjustment for any uncollected employee share of social security and Medicare taxes on tips, and the uncollected employee share of social security and Medicare taxes on group-term life insurance premiums paid for former employees.
Line 10: Total Taxes After Adjustments
Combine the amounts shown on lines 6–9 and enter the result on line 10.
Line 11a: Qualified Small Business Payroll Tax Credit for Increasing Research Activities
Enter the amount of the credit from Form 8974, line 12.
Line 11b: Nonrefundable Portion of Credit for Qualified Sick and Family Leave Wages for Leave Taken Before April 1, 2021
Complete worksheet 1 and enter the number on line 11b
Line 11c: Nonrefundable Portion of Employee Retention Credit
Complete worksheet 4 and enter the number on line 11c.
Click “Save and Continue” to move to page 2
Line 11d: 11d. Nonrefundable Portion of Credit for Qualified Sick and Family Leave Wages for
Leave Taken After March 31, 2021, and Before October 1, 2021
Complete worksheet 3 and enter the number on line 11d
Line 11e: Nonrefundable Portion of COBRA Premium Assistance Credit
Complete worksheet 5 and enter the number on line 11e
Line 11f: Number of Individuals Provided COBRA Premium Assistance
Enter the number of individuals provided COBRA premium assistance during the quarter.
Line 11g: Total Nonrefundable Credits
Add lines 11a, 11b, 11c, 11d, and 11e. Enter the total on line 11g
Line 12: Total Taxes After Adjustments and Nonrefundable Credits
Subtract line 11g from line 10 and enter the result on line 12. The amount entered on line 12 can’t be less than zero.
Line 13a: Total Deposits for This Quarter
Enter your deposits for this quarter, including any overpayment from a prior quarter that you applied to this return. Also, include in the amount shown any overpayment that you applied from filing Form 941-X
Line 13b: Reserved for future use
Do not put any information in this field
Line 13c: Refundable Portion of Credit for Qualified Sick and Family Leave Wages for Leave Taken Before April 1, 2021
Complete worksheet 1 and enter the number on line 13c
Line 13d: Refundable Portion of Employee Retention Credit
Complete worksheet 4 and enter the number on line 13d
Line 13e: Refundable Portion of Credit for Qualified Sick and Family Leave Wages for Leave Taken After March 31, 2021, and Before October 1, 2021
Complete worksheet 3 and enter the number on line 13e
Line 13f: Refundable Portion of COBRA Premium Assistance Credit
Complete worksheet 5 and enter the number on line 13f
Line 13g: Total Deposits and Refundable Credits
Add lines 13a, 13c, 13d, 13e, and 13f. Enter the total on line 13g.
Line 13h: Total Advances Received From Filing Form(s) 7200 for the Quarter
Enter the total advances received from filing Form(s) 7200 for the quarter.
Line 13i: Total Deposits and Refundable Credits Less Advances Subtract line 13h from line 13g. Enter the result on line 13i.
Line 14: Balance Due
If line 12 is more than line 13i, enter the difference on line 14
Line 15: Overpayment
If line 13i is more than line 12, enter the difference on line 15. Select how you would like to receive your refund by checking the appropriate box.
Completing Part 2: Tell us about your deposit schedule and tax liability for this quarter
Line 16: Tax Liability for the Quarter
Select the option that applies to your business
Line 12 on this return is less than $2,500 or line 12 on the return for the prior quarter was less than $2,500, and you didn’t incur a $100,000 next-day deposit obligation during the current quarter.
If you select this option, go to part 3
You were a monthly schedule depositor for the entire quarter.
If you select this option, complete the 3-month tax liability and then go to part 3.
You were a semiweekly scheduled depositor for any part of this quarter.
If you select this option, complete Schedule B and go to part 3.
Completing Part 3: Tell us about your business. If a question does NOT apply to your business, leave it blank.
Line 17:If your business has closed or you stopped paying wages
Check the box and enter the final date you paid wages.
Line 18a: If you’re a seasonal employer and you don’t have to file a return for every quarter of the year
Check the box. If this does not apply to you, skip this line.
Line 18b: If you’re eligible for the employee retention credit solely because your business is a recovery startup business
Check the box. If this does not apply to you, skip this line.
Line 19: Qualified Health Plan Expenses Allocable to Qualified Sick Leave Wages for Leave Taken Before April 1, 2021
Enter the qualified health plan expenses allocable to qualified sick leave wages for leave taken
Line 20: Qualified Health Plan Expenses Allocable to Qualified Family Leave Wages for Leave Taken Before April 1, 2021
Enter the qualified health plan expenses allocable to qualified family leave wages for leave
Line 21:Qualified Wages for the Employee Retention Credit
Enter the qualified wages for the employee retention credit
Line 22: Qualified Health Plan Expenses for the Employee Retention Credit
Enter the qualified health plan expenses for the employee retention credit.
Line 23: Qualified Sick Leave Wages for Leave Taken After March 31, 2021, and Before October 1, 2021
Enter the qualified sick leave wages you paid to your employees for leave taken
Line 24:Qualified Health Plan Expenses Allocable to Qualified Sick Leave Wages Reported on Line 23
Enter the qualified health plan expenses allocable to qualified sick leave wages for leave taken This amount is also entered on Worksheet 3, Step 2, line 2b.
Line 25: Amounts Under Certain Collectively Bargained Agreements Allocable to Qualified Sick Leave Wages Reported on Line 23
Enter the collectively bargained defined benefit pension plan contributions and collectively bargained apprenticeship program contributions allocable to qualified sick leave wages for leave taken. This amount is also entered on Worksheet 3, Step 2, line 2c.
Line 26:Qualified Family Leave Wages for Leave Taken After March 31, 2021, and Before October 1, 2021
Enter the qualified family leave wages you paid to your employees for leave taken This amount is also entered on Worksheet 3, Step 2, line 2g.
Line 27: Qualified Health Plan Expenses Allocable to Qualified Family Leave Wages Reported on Line 26
Enter the qualified health plan expenses allocable to qualified family leave wages for leave taken. This amount is also entered on Worksheet 3, Step 2, line 2h.
Line 28: Amounts Under Certain Collectively Bargained Agreements Allocable to Qualified Family Leave Wages Reported on Line 26
Enter the collectively bargained defined benefit pension plan contributions and collectively bargained apprenticeship program contributions allocable to qualified family leave wages for leave taken. This amount is also entered on Worksheet 3, Step 2, line 2i.
Completing Part 4: May we speak with your third-party designee
If you select “Yes”, provide the designer’s name and phone number. Also, select a 5-digit PIN the designees can use when talking to the IRS.
If you select “No”, move on to Part 5.
Completing Part 5: Sign here. You MUST complete both pages of this form and SIGN it.
Failure to sign will delay the processing of your return. Sign and print your name and title. Then, enter the date and the best daytime telephone number, including the area code, where we can reach you if we have any questions.
You will be prompted to electronically sign the form. Click “Save and Continue”
Auditing the return:
Choose the return you want to audit, click “Audit Selected Return”
Review the errors on your return and select “Continue” when you have “0” errors
Select “Signing Options” on the Signature page
Select “E-sign 8453-EMP”
Use your cursor to sign the form and click “Apply”
Click “Next”
Select the form you want to e-file and click “E-file Selected Forms”
Review your total amount and click “Continue”
Payment Information:
From the payment information screen, you can add a credit card, or edit an existing credit card. Once the necessary payment information is provided, click “Continue”
Form 941 – Transmit Return:
Once your form has been successfully transmitted, you will move to the confirmation page.
From this page, you can navigate to the distribution center to download a copy of your form or review your payment receipt.
Want to see steps for other business types, forms, or features? Comment below and we’ll make your request a future blog!
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