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Video instructions and help with filling out and completing Fill 940 Schedule Return

Instructions and Help about Fill 940 Schedule Return

In this presentation we will take a look at form 941 employers quarterly federal tax return for more accounting information and accounting courses visit our website at accounting instruction dot info here's a copy of form 941 this is the 2022 form you can find this on the IRS website at irs.gov these are going to be the components of the form we're gonna focus here on the calculation of the form we note that up top we're gonna have the ein number the name and then the address then we want to know which quarter we are talking about so remember that when we think about the quarters of course three months and a quarter there's 12 months in the year divided by for three months per quarter we will indicate what quarter we are talking about here remember that this is a quarterly form which is different from the yearly form and there is a yearly payroll tax form called 940 and we don't want to get those two mixed up they can seem similar but they're gonna be different the 941 is really the main form and it's going to be calculating the FI t federal income tax for the employees the Social Security both employer and employee and Medicare both employer and employee because these are larger amounts or this is my guess as to why we need a quarterly form rather than a yearly form because they're larger amounts and important then we have to have an added level of reporting meaning for example if we take a look at our 1040 for individual tax returns that we report at the end of the year for an individual reporting we do that on a yearly basis for the 940 ones for the FI T for the payroll taxes the Social Security Medicare we have to do that on a quarterly basis so that's what we're doing here the 940 then similar form to what we're working with here but will be for futa which is a much smaller tax so it's actually it's actually still a federal tax but it'll be a much smaller one when filling out this form we can pick up this information this is part one of the form line one says number of employees who received wages tips or other compensation so whatever the number of employees are in our case we have four employees at this quarter then we're gonna and note that the day's so this is the actual day within the quarter that we can pick up the number of employees and then we have the wages tips and other compensation this cell we got to be careful on because when we look at the wages total wages then in our case this is coming from our register numbers up here was 96 973 but this wages here is really trying to pick up the FI T wages note that line under it has to deal with federal income tax so really this line to it where we want the FI T wages which can be reduced by things such as an insurance or a retirement plan so this number is ninety one for twenty five ten in this case calculated as the total earnings ninety six nine seventy three point five minus those items that could be reduced and you can think of them when you fill out your form 1040 or what will reduce the HEI the 401k is not something that will be taxable as wages for adjusted gross income as well as if we're participating in a group insurance type plan now in this case if this was a cafeteria plan we would be reducing it but in this case we're saying this is not a cafeteria plan and therefore will not be reduced from the total earnings to get to the FI T earnings so we're just going to subtract for this example the five five four eight point four given us that ninety-one for twenty five so we just want to be careful and keep in mind that the FI T wages could differ from the wages for the total wages so here total wages fi T wages are going to differ then we're going to calculate the federal income tax withheld and here we have to just pull this basically from our table what we withheld from so this is what we withheld in accordance with our register that's the number we're going to use it would be nice if two numbers were related in some way meaning it would be nice if we could derive this number by some calculation from this number but we can't do that because the FI T is too complicated so although these know this number is kind of used when we break it down to an employee by employee basis it that rates will differ because each employee has a different number of allowances and a different number of possibly a 401k plan or retirement plan which could change those calculations as well as be as in different tax brackets so because we have a progressive system and a fairly complex system in terms of the federal income tax all we can do is say hey this is the total wages that were we withheld on in total for all of our employees and this is what we actually withheld there's no way the IRS can say let me look at that number and derive this number but we'll give both of that data to the IRS then we've got the Social Security wages and the Medicare wages these are going to be a bit more straightforward we'll pull this from our table as well the Social Security wages the ninety-six 973 that matches this 96 973 50 up here note that this too could change or be different from total wages if for example there was a cafeteria plan in this.

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