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!