Federal -File Quarterly and Annual Returns

Each quarter the federal 940 and 941 returns must be filed either electronically or a form is filled out and sent via mail.  In addition to the 4 quarterly returns, there is also the Annual 940 that must also be completed and filed.

 

 

QUARTERLY 940 FUTA:

This is due at the end-of-the-month after the quarter-end (i.e. for quarter ending 3/31, the 940 is due by 4/30).   Follow the steps below to get the information needed fill out the 940 form.

1. Print Quarterly 941   This is found in Payroll, Tax Reports/Forms (Task 10); Quarterly 941 / Monthly Tax Summary - PRHSUM (Sub-task 1). Print it for the quarter you are filing the return.

 

2. From the report, use the figure AMOUNT OF TAX (this is under the column titled:  FED UNEMPLOYMENT).

 

3. The amount can be filed in the same manner you report each pay days Federal Withholding, FICA and Medicare amounts.  For example, if you call these amounts into your bank, then report the 940 the same way.  

 

4. Please see the bottom of this document for a sample Excel format for filing both bi-weekly (or weekly) taxes

 

 

QUARTERLY 941:

This is also due e-o-m after the quarter-end (i.e. for quarter ending 3/31, the 941 is due by 4/30).  Follow the steps below to get the information needed to fill out the 941 form:

 

1. Gather all of the bi-weekly filing reports for Federal Withholding, FICA and Medicare amounts for the entire quarter.

 

2. Add all of the Federal Withholding amounts, the FICA amounts and the Medicare amounts, plus the grand total of all three.

 

3. Print Quarterly 941   This is found in Payroll, Tax Reports/Forms (Task 10); Quarterly 941 / Monthly Tax Summary - PRHSUM (Sub-task 1). Print it for the quarter you are filing the return.

 

4. Compare the figures added up in Step 2 against the figures on the 941 report.
   1. The Federal Withholding amount should be exactly the same.
   2. The Medicare and Social Security amounts should be close…not exact because of ‘rounding’

 

5. Fill out Schedule B, whether filing on-line or using the pre-printed form provided to you, use the reports from Step 1.   Use the actual pay dates.  The total should be exactly the same as the grand total from Step 2.

 

6. Fill out form 941, using the Quarterly 941 (printed in Step 3).
   1. Federal Withholding Tax goes on line 3
   2. FICA/Period figure is multiplied by the percentages for Social Security wages and Medicare wages.
   3. Add the Social Security and Medicare figures to the Federal Withholding amount….this total should be very close to the amount from Schedule B.
   4. Use “Current quarter’s fraction of cents’ line to make amount added in Step 6c equal the total from Schedule B.

 

7. If filing bi-weekly, the amount due should be zero.

 

8. Be sure to fill out the back of 941 (if you are using the physical 941)

 

ANNUAL 940 FUTA:

 

1. Print Quarterly 941   This is found in Payroll, Tax Reports/Forms (Task 10); Quarterly 941 / Monthly Tax Summary - PRHSUM (Sub-task 1). Print it for the entire year.

 

2. Print Deduction History for all pre-tax medical deduction codes (such as insurance, HSA).   This is found in Payroll, Payroll History (Task 14); Deduction History Report by Code, Employee # - DEDPRT (Sub-task2).  Print it for the entire year.

 

3. Total the deductions, as they are used in the next step..

 

4. Fill out Annual 940, using report from Step 1 (941 report for the year) and the figure from Step 3 (deduction totals).
   1. Line 3 is Gross Period figure from the 941 report.
   2. Line 4 (Payments exempt from FUTA tax) is the total of Step 3.
   3. Line 5 is Fed. Unemployment Excess from the 941 report.
   4. Line 8, the ”Total FUTA tax before adjustments”  should equal the “FUTA tax deposited for the year” (the total of the year’s 4 quarterly 940 FUTA amounts)
   5. If any adjustments need to be entered, fill out Part 3.

 

5. Determine Balance Due or Overpayment 

 

 

 

Annual – W-2’s:

Before beginning, verify the FICA Maximum and FUTA withholding percentage are for the year the W-2’s are being printed for and remember to change them back to the current year figures after the W-2’s are done and before the next payroll is processed.

 

1. Go to Tax Reports/Forms (Task 10); Print W2 Forms – FW2 (Sub-task 6).
   1. After selecting the printer, year and employee number range, a screen appears called:  “Summary of Fed/State/Local Wages & Taxes” (below is a sample)
   2. This screen can’t be printed, but you will need the information displayed.
   3. We suggest you ‘copy/paste’ the screen information onto a Word document and then print.

 

2. Before continuing with the printing of the W-2’s, you may use the left-arrow key to abort the program.  It can be run any time and any number of times.

 

3. Verify the figures from the ‘screen’ are correct.  Use the Quarterly 941, printed for the entire year for verification.  Below is a sample of a Quarterly 941:

 

Summary of Federal, State, Local wages & taxes to handwrite on W3

FEDERAL WAGES=	1	FEDERAL TAXES=	2
FICA WAGES=	3	FICA WITHHELD=	4
MEDICARE WAGES=	5	MEDI WITHELD=	6
STATE            WAGES	TAXES	CITY / WAGES/TAXES
MICHIGAN	7

 

P/R – F941A / Tax Summary                                                             PRHSUM

Gross Y  YTD          Period	FICA Period   Excess	Medicare Period    Excess	Fed Unemploy. Period    Excess	State Period Exc. Sta Unem
$ To Pay Taxes On	3	5
Tax Rate	Verify  correct	Verify correct
Amount of Tax	4	6
Fed W/Holding       (wages = 1)	2
S   State W/Holding	7

 

 

      The numbers from the top summary are used to verify the fields from the 941.

      Fields 1, 2, 3, 5, 7 must be exact

      Fields 4 and 6 on the summary….take these figures and multiple by 2, they should be very close to the figures on the 941.

      These figures are used on the W3 that must be submitted with the W-2’s.

 

4.  Print the W-2’s and file electronically or via mail.

 

 

 

 

 

 

 

 

SAMPLE TAX PAYMENT WORKSHEET

 

PAYROLL END DATE:                                  3/21/xx

PAYROLL CHECK DATE:                            3/28/xx

 

VOUCHER NUMBER:                                   __________

VENDOR:                                                       1518 PNC BANK

 

INVOICE AMOUNT:                         $3,040.91

REFERENCE # (EFT#)                                   00784821

A/P CHECK #            8                                   A/P CHK/FDP TRANS DATE        4/02/xx

 

G/L Distrib.	Description	Amount	Reporting Info	Totals
331-02-01	Acc FWT	$1,249.99
331-01-01	Acc  FICA	$725.74
332-01-01	Acc MEDI	$169.72
830-00-01	P/R Tax -FICA	$725.74
831-00-01	P/R Tax - MEDI	$169.72
331-06-01	FUTA (used for 940)	(used for 940)
TOTAL		$3,040.91
			1-800-272-5555	(phone # you call)
			xx-Employer ID #	5555 (emplr .password
			SOC SECURITY	$1,451.48
			MEDICARE	339.44
			FED.WITHHOLD	1,299.99
			TOTAL	$3,040.91