Payroll Tax Forms: Form 941

An IRS Form 941 is one of the federal payroll tax forms used to report:

• number of employees
• total wages paid during the quarter
• withholding and total payroll taxes paid during the quarter

Instructions on how to calculate payroll taxes. 

Note: For Canadian payroll tax forms..see Church Treasurers of Canada 

Payroll Tax Form 941 Due Dates:

Submit a Form 941 Employers Quarterly report to the IRS according to the following schedule:

• First quarter ends March 31...report due April 30
• Second quarter ends June 30...report due July 31
• Third quarter ends Sept 30...report due Oct 31
• Fourth quarter ends Dec 31...report due Jan 31

Note: there is an annual employer reporting form (Form 944); however, you cannot use that form unless the IRS has informed you to use it. All other filers must use the payroll tax Form 941.

The Church Accounting: How To Guide devotes a whole section of the book to payroll for churches. It covers payroll terminology and forms and then takes you through the steps necessary to set up a payroll, calculate and file the necessary taxes and forms, and even details how to handle the minister's payroll. It also includes sections on filling out IRS forms: 1099-Misc, 1099-NEC, and 1096.

If you have QuickBooks or are considering using it in the future, go ahead and purchase the QuickBooks for Churches and the How To Guide combo for a complete package on setting up and administering a payroll using QuickBooks.

QuickBooks for Churches & Church Accounting Combo Bundle

Preparing a Form 941:

Form 941 may be filed electronically or mailed. If you are using an accounting software package, see if there is an efile option.

Instructions for manually completing and mailing the 941:

• Summarize all your payroll information for the entire quarter.
• Enter payroll information gathered into the Form 941. (Note: Do not include a minister's housing allowance when figuring and entering wages paid. See this page for information on how to report a minister's housing allowance.)
• Don't forget to check box in line 4, if none of the wages or compensation reported were subject to Social Security and Medicare such as a qualifying minister.
• Sign the Form 941
• Make a copy of it before you mail it to the IRS.
• Mail in the preprinted envelope the IRS provided with your Form 941 package or if you don't have a preprinted envelope, look up the correct mailing address on page 4 of the Form 941 instructions booklet.
  
  Notice there are different address for different states and if you are sending a payment in or not.

Some smaller churches can still pay their payroll tax quarterly; however, most churches must pay their payroll taxes by the 15th day of each month. How often you must electronically pay your payroll taxes depends on whether your payroll tax liability is determined to be small, medium, or large by the IRS.

Your tax liability is considered small if, for the entire quarter, your tax liability is less than $2,500.

Your tax liability is considered large if for the previous two years, the average payroll tax liability is more than $50,000 per year.

If your tax liability is more than $2,500 per quarter and less than $50,000 per year, you fall into the medium category.

See section 11 of Pub 15 (Circular E) for information and rules about federal tax deposits. 

****Important: Most states have their own state payroll tax forms due in the same month as the form 941s. Check with your state for the appropriate forms and due dates.

Did your organization pay more than than $600 in rents, services, prizes and awards and other income payments to any nonemployee during the year? If so review this page: Form 1099-MISC Information and Instructions

If you have paid employees, you must prepare W-2 and W-3 forms each year. Review this page for Form W-2 Information and Instructions.

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The comments above are for general information purposes only and do not constitute legal or other professional advice on any subject matter. See full disclaimer.