Keeping up with the many changes from the IRS regarding your quarterly payroll taxes is difficult. With the exception of the first quarter of 2020, we have seen a new Form 941 for each quarter.
As an employer, you have a business to run, that doesn’t always leave much time for checking IRS updates. That’s why TaxBandits is here to do the work for you! Not only do we make your IRS tax filing easier, we also keep up with all the important IRS updates that could affect you.
Here is the latest update from the IRS on Form 941-X, The Adjusted Employer’s Quarterly Federal Tax Return or Claim for Refund.
What is Form 941-X?
This is a corrections form. If you notice errors on your Form 941, Employer’s Quarterly Federal Tax Return, you will need to correct them as soon as possible. To do this you simply file a Form 941-X with the correct information regarding your employees’ wages, federal tax withholdings, Medicare and Social security taxes, etc.
What has changed on Form 941-X?
Much like the Form 941, there are a few changes to this form, but not the complete overhaul that we saw for reporting in the second quarter of 2020. Here are the changes to the Form 941-X for the third and fourth quarters.
Line 24 has been adjusted to reflect the changes to Line 13b on the Form 941. Instead of entering the employer’s share of Social Security taxes deferred for the quarter, employers can additionally choose to defer their employees’ share of Social Security taxes as well. This is due to the Employee Social Security Tax Deferment passed by the current administration.
You should use Line 24 to correct the employee deferral for the second quarter of 2020 and the employer and employee deferral for the third and fourth quarters of 2020.
Line 33 has been divided into Line 33a and Line 33b. Line 33a requires the same information as the original Line 33. Line 33a should be only be used to correct errors from the second quarter of 2020. However, Line 33b was added so that employers can correct the amount of the employees’ Social Security taxes that were deferred during the quarter, this should be used when correcting an amount from the third and fourth quarters.
If you are an employer that has chosen not to defer your employees’ share of Social Security taxes, these changes will not actually affect you. If you have chosen to defer your employees’ share of Social Security, these changes will allow you to correct these amounts if needed.
Who should file Form 941-X?
Remember, this is simply a draft and should never be filed with the IRS. If you need to report corrections for the second quarter of 2020, you should submit the most recent finalized version of Form 941-X that was released on September 10, 2020.
We can expect a finalized version of the Form 941-X as we get closer to the third quarter deadline of 2020.
Do you need to file corrections for the second quarter of 2020? You can easily prepare the Form 941-X with TaxBandits!