 In this presentation, we will take a look at Form 941. The Form 941 is a quarterly federal payroll tax return. So the Form 941 is going to report those federal taxes, those federal taxes including the federal income tax, the social security, and the Medicare on a quarterly basis. Note that when we talk about the federal income tax, we're not talking about the taxes for the corporation which are going to be reported on the corporate or whatever business entity we're talking about. It's not the income tax for the corporation, it's the income tax for the employees. So note that the Form 941 is going to report the payroll taxes. And in this sense, we're talking payroll taxes for both employer and employee. Remember when we record something on the books as payroll taxes on the income statement for payroll tax expense, we typically just think of the employer portion. That's what we will record as payroll taxes on the income statement. The employee portion will be included in just the payroll expense because it's really payroll expense that has been earned by the employee. That's not the taxes that we're paying over and above what we would pay the employee anyways. It just so happens we're going to pay that portion to the government rather than to the employee, although the employee earned it. When we talk about the 941, we're going to be reporting not both components, the withholdings we took from the employees and the component for the payroll taxes that we owe on top of those withholdings. Now, quarterly then will mean that there's going to be four payments. We're going to have divide the year into quarters. So there's 12 months in the year. If we divide 12 by the four quarters that we're going to have, we're going to have three month time periods. So the first quarter is of course January, February, March, then April, May, June, July, August, September, October, November, and then December. Three month time periods. And when you first start looking at this, that can seem a little bit confusing when we see quarters. You might just start to think it's easy. Sometimes people start to think that there's four months because it's one quarter. But remember, we're taking four quarters of a 12 months year. 12 divided by four is three. We've got three month quarters that we're talking about whenever we break the year up into the quarters. And then the question is when do we have to report the 941? When do we actually have to turn them in? Well, the first quarter is January, February, March. And then we have till the first, the next month to turn in the 941, meaning we have to record everything and get it all set up and report it by April 30th. The second quarter being the same April, May, June. And then we have to compile that data as of the end of June for the three months into June and get it done and turn it in by July 31st. And then the third quarter, which includes July, August, September, has to be turned in by the end of October or is due by the end of October. And then the quarter of October, November and December is going to be due by January 31st of the following year. So that's going to be our quarterly returns when they're due. This is going to be a copy of the 941. And you can find this on the IRS website. You can just go to irs.gov and type into the forms section a 941. And you can get a copy of what the 941 looks like. This is just the first page. It's typically a two page document, but this gives you the major components of the first page. If we zoom in on this a bit, we're going to say that we have the employer identification number. That's going to be the ID number for any payroll calculations. And again, any entity, no matter what the entity will typically need an EIN number and to report the payroll, we got the name, trade, address. Then we need to report which quarter that we are filling out the 941 for. And then we'll go through these calculations. We'll fill this out a little bit more completely later. But note, of course, we have the wages, tips and compensation. This will be for all of the employees here. So we're talking all of the employees kind of combined together. When we do the payroll checks and do the paystuffs, we'll actually have to break this out by employee as well and give the similar information for the employees. But this is going to be combined all of our employees. Then we've got the federal income tax withheld for wages, tips and other. This number, there's no calculation here. Note, we're not going to basically take the wages times anything we can't because it differs. It's not it's not a straightforward tax. It'll differ from employee to employee. All we can do is basically add up what we came up with based on our calculations on what we withheld from each employee. Then we have the social security and Medicare calculations here. Now what we have is the social security wages and then the Medicare wages. And then we have the tips broken out separately, which if we have tips that would be applicable. Otherwise, we put the total wages here. Now note that this may differ than line two, the social security wages for all of our employees may differ from line two. For one thing, here there could be a cap on the social security wages. And you'll this will be reflected again on your W2s. You may say that there's three lines for wages for social security wages, federal income tax wages. Federal income tax is decreased by things like a 401k plan, whereas the social security is not. Social security wages have a cap on it, whereas the federal income tax does not. And then Medicare doesn't have a cap on it, whereas the social security does. So we could end up with three different, you know, wages lines, one for federal income tax, which could differ from these the social security wages, which could differ from the Medicare for the entire company. Then we're going to take the social security wages and multiply it times point 124, which of course is if we move the decimal place two points over 12.4%. And remember, we said that it was 6.2. That's how much we pay and the employer times two. That's where you get in there 12.4. We're moving the decimal two places over this would be 12.4% or point 124. On the Medicare side, we have the point 029, which is point 045, 0.0145, which is what we pay on the employee and employer side times two for both. And so we're paying point 029 between the employer and employee. So that's where we can see that we're reporting both sides here, the employer and employee side. And then we're going to basically add those columns up here to get to get our total taxes that we will owe, meaning we're adding the federal income tax, the employee tax only, and the social security and Medicare, which is adding up the employee and employer portion of federal taxes. Then we have some other lines like adjustments. And there's going to be some fractions of a penny type of things that are off. So if something's if our calculations are different than what what we calculated to be by fractions of a penny, then we can make some adjustments there. And then we have some other types of adjustments we won't go into at this time to finally arrive at the taxes after adjustments, whether they be just rounding adjustments, or any type of other adjustments involved reporting those three types of taxes. This is reporting then the liability component. This is how much we owe. We've recalculated it. We've already recalculated it as we've done payroll in our payroll registers and actually withheld what should be reported here. Because this line here, this is just going to report what we already calculated for the federal income tax. And we've recalculated a flat tax, that flat tax just being a percentage times each individual's pay rate. So if we take the total times the pay rate, it should be the same. So our tax should be pretty much exact. And then we have this rounding thing that we could round if it's not exact. Now line 12 is total taxes after adjustments and credits. And then line 13 is going to be the deposits we make. So these are going to be the deposits we've made. So notice what we're doing here. We've got the liability that's been fully adjusted here. And then we've got what we deposited already. So this isn't a form where we're going to make the payment at this time. We're not trying to determine, hey, how much do we owe? We're just basically double checking how much we owe calculating it in kind of a different way and reporting it on a quarterly basis here. So this is just a reporting requirement shouldn't be an area where we are filling out and paying taxes at this point in time. So then we have the balance due or overpayment, which again, hopefully there isn't any balance due or overpayment. If we made an error somewhere, then there could be. But hopefully it's all it's all been paid up for the most and we're good. And we're just going to report what has been done successfully already. Then we have section B of the 941. And the section B is going to give us some of the payment type of schedules. Now section B is only going to be required if we're over a certain amount of income amount. Otherwise we can we can have a summary that's part of the 941 that is a bit less detailed. But of course, what we're going to have here is we're going to say there's three months within our quarter that we're reporting for the 941, whether it be quarter one, two, three or four. And we're going to actually break out the payments that were made here. So we'll just actually break out the payments by month and list out those payments. And of course, then we can sum up those payments for month one, month two, and month three. And if we add up the three months, that should then add up to our total payment that that we have our total payments, the sum of all the payments we have made designated to this quarter. And as we can see here, the total here in line 12 on formed 941. So whatever we come up with here should, this should be supporting what we reported on line 12 of 941. And if there's any discrepancies, if the IRS says, Hey, we didn't get paid and this and that. And then of course, then we have to go through these will give us a list of the actual payments, we can see if they've cleared the bank and see if these payments have actually cleared. And then we can talk to the IRS and actually go through the list of payments we have and take and tie them off and ask the IRS, Hey, is this what you have on your side? And the problem will typically be if there is a discrepancy that the IRS either doesn't have the payment, it didn't clear, or it's been applied to the wrong quarter, which is very possible depending on how we reported it. If we accidentally made a payment at the end of the third month and applied it not to quarter one, but to quarter two, then it got applied to the wrong quarter. And we just got to make sure that we have our applications to the correct quarters. And that should be a way that we can fix any types of problems related to that and simulation and the simulation.