 In this presentation, we will fill out form 941 Employers Quarterly Federal Tax Return for the fourth quarter. We're going to start off with the EIN number and the address. Support Accounting Instruction by clicking the link below, giving you a free month membership to all of the content on our website, broken out by category, further broken out by course. Each course then organized in a logical, reasonable fashion, making it much more easy to find what you need than can be done on a YouTube page. We also include added resources such as Excel practice problems, PDF files, and more like QuickBooks backup files when applicable. So once again, click the link below for a free month membership to our website and all the content on it. The EIN number typically different than the other normal reporting number that we would report with. Depending on the type of entity, our normal reporting number for recording the income tax could differ for a sole proprietor, a partnership, or a corporation in other words. The EIN number will then be a more standard number when just reporting the payroll for the Internal Revenue Service. We're going to be dealing with the fourth quarter, the quarter of October, November and December. Remember that the quarter has the three months in it here for the fourth quarter, 12 months divided by three, three months per quarter, last quarter of the year. This is a busy time for us at this point, the end of the year here where we have to do the 941s, the 940s, the W2s, the W3s, and put this all together. If we scroll back down, we're going to go through our information. The first cell here, the first line in part one says number of employees who received wages, tips, or other compensation. And for the fourth quarter, as of December 12th, fourth quarter, we had four employees. Wages, tips, and other compensation. Remember that this really lines up to the federal income tax. So we're kind of looking for the FIT wages tips. So if we go to our worksheet and we scroll back down, I've frozen the pains up top. So freeze pains by going to cell A4, going to the view tab, and then the freeze pains and freeze the pain. Then we're going to scroll back down to our data that we have compiled at the bottom. Got the data for the third quarter. We've compiled the third quarter data and we've compiled the data for the totals, which are now populating for us automatically. So if we double click on this, it's populating all of the totals for each month of operations. However, what we need is the fourth quarter. We're going to add Q4 here, and we're just going to add the months related to the fourth quarter. And then we'll do the calculation here. That's going to be October, November, and December. And then we'll copy and paste this across. So within cell F40, we're going to say equals. And we're going to scroll up to October. The totals for October is going to be here in F23 and say plus. And then scroll down to November in F30 and plus. And then scroll down to December in F37 and enter. So there's our three months. Now if we want to check this, we can highlight these two numbers. Excel will then calculate it down here 240,411. That matches our total, which we calculated by summing up all the months. So it looks good. So now we're going to highlight that cell. I'm going to copy it. Right click, let's copy that cell and copy. And we're going to put that over here in the data all the way. We're going to select all these empty cells for the fourth quarter. Right click and paste. It shouldn't matter. We can paste 123 or normal pasting, or not 123, but either formulas or normal pasting. And that should do what we wanted. If we want to check any of these, it's probably best just to check the net check over here. We highlight these two. It adds up to the total of 141,976,23, which looks like that number. So that looks good. So now we need to make sure that we're picking up the right data now when we fill out our form. So I'm going to go ahead and make, we're going to pick up this data. We don't really need this over here. I'm going to highlight all this data. This is what we're going to be using to fill out our form. And I'm just going to right click and let's make that green. Make it like a light green, a nice light green. Okay. So now I'm going to scroll down just so that's the only data we can see. And that's the data we will use. So I'll scroll back over. There it is. It looks fantastic. Okay. So we were looking for the FIT wages. And that's going to be the total earnings here. Less what would be deducted from it, which would if would be the 401k retirement. And if this was a cafeteria plan, which it is not, then we would deduct that as well. So here we're just going to deduct the 401k, the retirement plan. So if we take the calculator here, we're going to say it's the 144232.5 minus the 8322.6. And that'll give us the 135909.9. We'll go back and populate our worksheet with that. So back to our worksheet. We're going to populate with 135,909 tab, 90. Okay. So now we want the federal income tax withheld. Now remember that the federal income tax withheld really has nothing to do with this number because it changes per employee. So this is just the sum of all the wages, but we can't apply a flat rate because everybody has a different rates and they have different withholdings and allowances. So all we can do is tell the IRS, hey, you know, this is what we withheld. So we're going to go back over here and say, what did we withhold? And we withheld for the FIT that's 25. So I'm going to put that in the calculator so we can see it 25. Undo, undo that. So it's 25212.4. So that's what we're going to be using. I'm going to go back to our 941. So we withheld 25212 tab, 40. All right. Now we want the social security wages, which will differ from the federal income tax wages. So we'll go back to our worksheet. We're going to pick that up here. We have a separate column for the social security wages. Now the reason it's going to be different is that we had that one employee, Judy Jones, that's going to hit the cap. She's probably like the owner here making the most of the money. So she hit the cap and therefore stopped having social security wages at that point. And so we have less of a social security wage there. Also note that if there's a qualified cafeteria plan, which this is not, then it could differ for that as well. So those are some reasons why the OASDI wage could differ from the total wage as well as the Medicare wage. So we're going to pick up that 97. So it's going to be 97632.2 that we'll put over here in our 941. 97, 632 tab, 50 cents. We'll multiply that times the 0.124, which can probably isn't a percent that's been drilled in your head if you've been working this whole problem as is the percent of 0.062. And that's our social security for the employee and employer portion if we multiply it times two to take care of both employee and employer portion at one time. That's our 0.124, which we will then multiply at times 97632.5 to give us the 12,106.43. So here we're going to put down the 12,000 comma 106 tab, 43. You may not recognize that number from our worksheet here as well and that's because it's going to be the employee portion, this number, plus the employer portion, that number, which adds up to 12,106.43. So that could be a little confusing when we go back and forth from the 941. Back to the 941. We have no tips, which is nice. Don't like dealing with tips. And then we have the tax Medicare wages here. So we're going to go back to our worksheet. Now the tax, the Medicare has no cap. So we're just going to pick up total earnings. When would it differ from total earnings? If there was something to be deducted from total Medicare such as a cafeteria plan, a qualified cafeteria plan, which is a section 125 plan. So we're just going to pick up total earnings, which is going to be this 144232.5 and we're going to pull that into our worksheet. It will be 144,232 tab 50 cents. We'll multiply that times the .029. You might be saying, well, where does that come from again? We don't recognize that percent. We've probably recognized .0145 if we've been doing this whole thing. And if we multiply that times two, we get .029. So it's the employer and employee portion represented in the percent format times the amount of 144232.5. That gives us 4182. So we'll put that 4182 over here. So we've got 4 comma 182 tab 74. Next, we've got to add column two from lines 5a, 5b, 5c, 5d. So we're just going to add these up then. It's going to be a good time. So we've got to pull the calculator out. Column two, we're adding up 12106.43 plus 4182.74. 1628917. So that's going to go here in e5. That's going to be 16 comma 289 tab 17. Okay, so then we have a section 3121 notice and demand. We don't have anything there, leaving it blank. Next line is going to say total taxes before adjustments. Add line, we have 3, 5e, and 5f. So we're going to add up, in other words, FIT, Social Security and Medicare, which we've already combined together here. So it's going to be the FIT 25212.4 plus FICA taxes, Social Security and Medicare of the 16289.17, given the 4151.57. So we're going to put that here. 41 comma 501 tab 57. Okay, then we have some adjustments. If there's any pennies off, if we're off by pennies, they're going to allow us to make an adjustment that are off from the deposit to the liabilities, which is nice. We're going to scroll on down to line 10, which is total taxes after adjustments, which will remain, in our case, 41 comma 501 tab 57. Then we have the qualified small business payroll tax credit, nothing for us here. Then we have the total taxes, which will be the 41 comma 501 tab 70 or 57. Okay, that should be 41. 41. All right, line 13, then is going to be the deposits. Okay, so remember, this is the liability now. So we're telling the IRS, hey, this is how much we owe. We recalculated it. You can see how we got to it. Now we're going to tell you what we actually paid you. And it should be the same because we've already made the payments. This is an information form. Hopefully there will be nothing due because it should just be an information form. So to get the payments, we'll go back to our worksheet over here. Now it's not going to come from the register. This is telling us what the liability is. This doesn't tell us when we paid. We have to go back to our journal entries to see where the payment happened. We can go to the GL, we can find the cash payments that happened. So if we go to the GL, we see our payments over here. We're going to have to break out more detail, however, because we've grouped the payments together. So we're going to have to go to the journal entries and see where these payments are. And we can see that we made a payment on 11-1, or sorry, we made the payment on 11-15. And this payment was made for the pay period ended October. So the October pay period was paid with this check, which represents the amounts for OASDI, HI, and FIT, Social Security Medicare Federal Income Tax, for October. So it was made in November. It was made in December for the taxes and liabilities of October. And then we had one in December that we made this payment for the activity that happened in November. And then this payment was in January of the next year, but it was paid for the payroll period into December of the prior year. All right, so those are going to be our payments that we need to pick up. Now, it's going to include, these payments only include FICA, the FICA taxes, and FIT, which is exactly what we want. That's what we're calculating here. You'll note that it doesn't have, as the prior pay periods, FUTA and SUTA involve, which makes things easier. Why not? Because all four of our employees have reached the cap already and therefore don't have any FUTA or SUTA at this time. So that makes it easy. We can just pick up these numbers. It's going to be this number, the cash check we paid for Social Security Medicare and Federal Income Tax, this number, the amount we paid, and this number, which adds up to 4151.57. We can do that again with the calculator, just for the fun of it. It's always nice to punch things into the calculator. 15760 plus 14321.59 plus, and let's see if we can find that last number, which is right there, plus another 11419.98. And that's going to give us the 4151.57. Did I add that up? Yep. Okay, so now we're going to take that number, go to the 941, and it should match this number, which it does, 4151.57. So our story so far, Internal Revenue Service. This is our liability. You can see how we got there. This is how much we deposited to you, and therefore we don't owe you anything right now. If you want to see more support about this number, the actual deposits we made, then we're going to fill out this second form, the 941. Now we're a quarterly depositor, so we may not need it, but I want to just show you this form, just to show you the support, the more detailed support type form that you can have. So we're going to say it's the fourth quarter here, and we just got the three months that we're going to be dealing with, and we're going to break out all the payments for the three months. We only have one because we're quarterly, and we're monthly payroll processors. But if we were weekly or bi-weekly or semi-monthly, we would have more than one payment, most likely. So to do this, we're just going to go back here, and we're just going to pick up each of these individually, each of these payments. So the first payment that was applied to the first month, it was made in November, but applied to October, is this 15,760. So I'm just going to memorize that one here this time, so we're going to go back here, and actually we're going to go back here. It's going to be the 15,760, and 90 cents. That's our only payment, so if we sum that up, it's going to be the same over here. 15,760, and 90 cents. So then we're going to go to our next payment that happened in the next month. Yeah, it happened in December. We made the payment in December for November, and that's going to be the 14,321,59. Just double-check this payment. Actually, there's no 90 cents there. I don't know where I got that 90 cents. I'm going to go back. There's no 90 cents. No 90 cents. Just, okay. My memory's not good. Okay, so then we're going to go back over here. Now we've got December. We're going to pick up this 14,321,59 that was made in December for November. So we'll pick that up. That happened in our second month. So that's going to be here. It's going to be 14,321, tab 59. Now that's going to be our total because it's our only payment. 14,321, tab 59. Okay, then we're going to do this one more time for the last month of payment. It happened in January of the next year. That's when the payment was made but for the last quarter, or month, December of the prior year. So that's the 11,419,98. So we'll go back to our data here. We're going to say that was 11,419, tab 98. That's our total as well, which will be 11,419, tab 98. Okay, so now we'll just add these up and it should come out to our total if we have done this properly. So we're going to say 15,760, plus 14,321,.59, plus... See if we can find that last number. There it is. There's the last number. Plus 11,419,.98. Enter. 4150,157. I think that sounds familiar. I think that's what we wanted. 41,501, tab 57. That number should then match what's on the 941. So 941,501,.507. So we're basically saying that this will give the support and if the IRS wants to know what checks we have written, we can say, hey, here's the checks. Here's when we wrote them. You should be able to find them on your end and if they can't, then we go through and match off check by check and try to see, one, did the checks clear on our side? If they did, then the IRS deposited the check. Two, if that's the case and we still can't find them, did the IRS apply the check to the wrong time period? Meaning possibly it wasn't, for example, this check here, maybe, and it could be our fault, maybe we applied it in the form when we made the payment to January of the next year when it should have been applied to December of the prior year. So those timing differences and applying the payments to the proper place is commonly the problem that will happen. So then we just need to make sure that we have it all tied out and this form can help us do so.