Federal Tax Forms For Employee Payroll

Trust me, I don’t enjoy being the bearer of such obnoxious and boring information, but being on top of your employee payroll and taxes is very important.

First of all, it will keep you out of trouble. The IRS is quick to tack on extra penalties for late filing and interest charges. Second, if you have this aspect of your business under control, you will be able to focus on your core business, rather than being bogged down by the stress of not knowing how to handle these things.

Yesterday, I covered the forms necessary for hiring a new employee, and previously, I went over the withholding that is taken out of each paycheck. Today, I will summarize the forms necessary for reporting and paying the employee taxes that are owed to the federal government.

To complete all of these forms by hand and to submit them by mail is probably not the best use of your time and resources. QuickBooks offers a very easy-to-use payroll add-on for about $250 per year. This will also make electronic filing a lot simpler.

Form 941 – Due Jan 31, Apr 30, Jul 31, Oct 31 (for IRS)
Quarterly form that reports all wages and withholding paid that quarter. If your employees are seasonal and you do not have taxable wages every quarter, be sure to check the “seasonal employer” box on line 19. You only need to file this form when you have paid wages for the quarter.

Form 944 – Due Jan 31 (for IRS)
Annual wages report. You may be told to complete this form if your wages drop beneath a certain amount. Do not complete this form unless you are directed by the IRS.

Form 940 – Due Jan 31 (for IRS)
Annual form that summarizes unemployment withholding from previous year.

Form W2 – Due Jan 31 (for employee)
Form you present to employee summarizing wages paid for previous year. Your employee(s) uses this form to complete his/her personal income taxes.

Form 1099 – Due Jan 31 (for independent contractor)
Form given to independent contractors, summarizing what you paid them the previous year.

Form W3 – Paper copy due Feb 28 OR e-file due Mar 31 (for SSA)
Summary of wages paid from previous year to be submitted to Social Security Administration. Along with this form, you should also submit copies of each W2 and 1099 forms that you presented to your employees and independent contractors.

These are only the federal forms required. You will want to also check your specific state requirements. Also, I will talk more about the differences between employees and independent contractors in the future.