IRS Form 941-X: Your Tool For Fixing IRS Form 941

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Let’s face it: IRS Form 941 is downright confusing. Filed quarterly to report on withheld income and FICA taxes, this document outlines what, exactly, has been withheld from employee pay. Unfortunately, opportunities for errors are abundant, even among the most conscientious, detail-oriented employers.

As an employer eager to avoid problems with the IRS, the prospect of correcting a previous error may feel intimidating. No need to fear; below, we highlight common errors and clarify the process for fixing Form 941:

Common Form 941 Errors

Many employers accidentally enter the wrong number into one of the myriad of boxes included on form 941. Employers may accidentally over or under-report wages, tips, or taxable Social Security or Medicare wages and tips.

The Solution: Form 941-X

Fixing mistakes on IRS Form 941 means completing another form: 941-X. This document allows you to fix the following:

  • Wages
  • Tips or other forms of compensation
  • Taxable Social Security wages and tips
  • Taxable Medicare wages and tips
  • Qualified payroll tax credits for small businesses increasing research activities
  • COBRA premium assistance payment credits

While form 941-X can be used to fix errors, it is not designed for requesting abatements. Instead, refunds for assessed penalties can be requested via Form 843.

If you made multiple mistakes on Form 941 (for example, under-reporting in one box and over-reporting in another), you’ll need to file a separate Form 941-X to fix each error. Additionally, multiple forms must be used if your mistakes extend beyond one quarter. Additionally, you’ll need to secure written consent if your error impacted employee withholding.

Struggling with Form 941-X or other IRS obligations? Work with an enrolled agent from Highland Tax Resolution. Reach out today to learn more.