Tuesday, July 25, 2017

What Are 941 Payroll Taxes? How Do you Send them to IRS?

The 941 blog is devoted to businesses who fall behind on their 941 payroll taxes. But what are 941 payroll taxes and what purpose do they serve?

If you are a business who decides to have employees, you will be obligated to pay their 941 payroll taxes which means:

1. You withhold their Federal Taxes from their paychecks and send them to the U.S. Treasury on their behalf. You are essentially the "conduit" of this money to the IRS (you don't have to pay anything just send the employee's money to IRS on their behalf).

2. As the employer, you will pay 7.65% of their salary towards their Social Security and Medicare Taxes. This amount is really the "payroll taxes." (The employee themselves pays the other 7.65%). 

3. The totals of the #1 and #2 are sent together as payroll taxes to the U.S. Treasury.

When you become a business and plan to have employees, you'll get an Employee Identification Number (EIN#) HERE. This EIN will also help you get a bank account and legitimize yourself. 

Going forward, the easiest way to pay your 941 payroll taxes is by signing up to make the payments at Electronic Federal Tax Payment System (EFTPS.COM).

Have you fallen behind on payroll taxes? EMAIL us a description of your tax issue HERE and we'll contact you!

Saturday, January 7, 2017

Defaulting your IRS payment plan on 941's? Receive a Default Notice? What's Next?

If you had previously negotiated an installment agreement on 941's with the IRS and then either 1. Stopped making payments or 2. Filed a 941 form late or 3. failed to make current 941 deposits then you may very likely be in DEFAULT of your agreement as demonstrated by receiving this CP523-default notice. Is this really the end of the world? Not even close. This default notice will show you that your business has 90 days to get your act together before the IRS levies you (or the IRS assigns a Revenue Officer to your case). 

What do you do in those 90 days? File the 941 forms that are unfiled and STAY CURRENT on your CURRENT payroll meaning: the CURRENT month not the old 941's. When you and your accountant go back to the IRS in the next 90 days, you will be in a better position and have extra leverage. So...use the 90 days to get back into shape, enjoy the lull in back tax payments and stay current on your current month's tax issues. 

If you defaulted on your back tax agreement, staying current on 941's is the most important thing you can do while also contacting the experts at Washington Tax Services at 1-888-282-4697.. You can also EMAIL us a description of your tax issue HERE and we'll contact you by email/phone!