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W-2 Filing Available for All Businesses and Individuals
We are pleased to announce that all businesses and individuals can now file W-2 forms with Zenwork. If you previously received a letter from the Social Security Administration (SSA) regarding electronic wage report submissions, please note that the issue has been fully resolved. Our systems are fully operational, and we are processing W-2 and W-2C filings without any disruptions.
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When you manage a business with employees, navigating and fulfilling various tax requirements is particularly essential. Two important tax forms to understand for reporting employee wages and deposited taxes with the IRS are Form 941 and Form 940. To help you identify the distinctions between both forms, this guide covers the differences between Forms 941 and 940, examining their purposes, distinct filing criteria, and deadlines.
Tax1099, IRS Authorized e-File Service Provider offering Form 941 e-Filing easy and secure way.
The 940 Form is an IRS annual tax return used by employers to pay and report FUTA taxes. The Federal Unemployment Tax Act (FUTA) is a federal law that funds support for individuals actively seeking employment but are currently unemployed.
FUTA taxes only apply to the first $7,000 of each employee’s wages in a calendar year. This means that if an employee earns $10,000 in a year, you will only need to calculate the FUTA tax on the first $7,000. Any wages beyond this threshold are FUTA-exempt.
It’s important to note that certain payments are excluded from the calculation of the $7,000 wage threshold. This typically includes payments made under state unemployment compensation laws and any payments made to a retirement plan on behalf of an employee. These exclusions reduce the overall FUTA tax liability for employers.
941 Form is also called the Employer’s Quarterly Tax Form, used by employers to report the Federal income tax withheld, social security tax, and Medicare tax (FICA taxes) for the employee’s paycheck. This form is also used to calculate the employer’s share of Social Security and Medicare taxes.
Employers that pay wages that are subject to withholding must file Form 941 every quarter.
The key differences between Form 940 and Form 941 are their purpose, filing frequency, and the employment taxes they pertain to:
This form serves the purpose of reporting and settling the federal unemployment tax (FUTA) liability. The funds collected contribute to supporting unemployment benefits. Employers use Form 940 to compute and declare yearly FUTA tax liability.
Form 941 is used to report and pay federal income tax withholding, Social Security, and Medicare tax—collectively referred to as payroll taxes.
Form 940 is filed annually, due January 31st of the following year (or February 10th if FUTA is fully paid on time).
Form 941 is filed quarterly—due the last day of the month following each calendar quarter (e.g., May 1, July 31, October 31, and January 31).
Form 940 covers FUTA taxes only, which are not deducted from employees’ wages. Employers pay these taxes directly.
Form 941 reports payroll taxes including federal income tax, Social Security, and Medicare taxes withheld and matched by employers.
After filing Form 941 or 940 via Tax1099, you’ll receive an email update the same day on the status.
Note: IRS does not accept Form 941X electronically—it must be printed and mailed.