Tax question-Form 940 & 941
 

In laymans terms what are these forms used for specifically? If you are a one man show, single member LLC do these apply to you? I just fired my accountant and I am trying to learned as much as I can about that side of my business.

The 940 is the Federal unemployment deposit ticket.

The 941 is the Federal withholding deposit ticket.

If you are filing quarterly deposits with the Feds, you'll need both these tickets.

What.... so you fired your accountant and now your'e asking an accountant for free advice.:confused:

To amplify what Brian posted,

Form 940 is an annual filing with IRS to report federal unemployment tax liability and payment. It is assessed on the first 7,000 of wages and is generally capped at $56.00 per employee.

Form 941 is a calendar quarterly filing which is used to report wages & tips, Soc. Sec. & medicare taxes and employee federal income tax witholdings.

If you have employees, when you have to pay these taxes during each quarter depends on several factors.

You don't say whether you have employees working for you or not. If you do, you will need to file these forms. If you don't, you won't.


Check out the IRS website. Look up a publication called Circular E. It has everything you never wanted to know about employment taxes.:D:P

Find a new accountant!;)

Thanks for the advice!
I do not have any employees and I fired the accountant because he was terrible at returning calls, following up on questions and never wanted to explain anything to me. Essentially he wanted to do everything without telling me a thing...well I have a few hundred thousand dollars invested in my business and I want to know EVERYTHING that is going on. I am interviewing accountants now, but the learning process does not stop there.

:)

Why does that sound so familiar..........

I'm on my fifth accountant. The only reason we get along is that I use his Lacerte tax software to do my own taxes. He prepares the corporation return and I don't ask him any questions about it. I do all the worksheets and the expenses and income statements and he just plugs the data into the form.

However, the top line and the bottom line better match my worksheets or he's doing it again........

Previous accountants would simply toss a bunch of numbers at the form and see what sticks. Unbelievable.........didn't match reality in any way shape or form.

I am a single member LLC and all of my taxes funnel down through me. One of the other franchisees suggested I use Turbo Tax, which I did for this year. In the big picture I want to just keep on top of things and make sure I fully understand what is going on VS simply giving an accountant figures and signing off at the end of the year.

Thats the unfortunate truth! These so called self proclaimed accountants I think are good for nothing and they are often responsible for leading employers like us into trouble for the lack of their knowledge. To me the best option is to assign the job on reliable consultancies who can efficiently manage these with minimum headaches for us.

I can tell you from personal past experience that the Feds are very serious about the 941 especially- be sure to read and re-read Circular E and the website if it applies to you.

Way back in my past I was an IRS Revenue Officer...:cool:

Rick

I hope you aren't painting all accountants with the same brush? Or are you?

Who are these "so called" "self proclaimed" accountants you speak of?
Licensed CPA's? Not exactly what I would consider self-proclaimed.
In my state (NJ), every person holding himself out as a public accountant, whether as a Public Accountant (licenses no longer issued), Certified Public Accountant, Registered Municipal Accountant or Public School Accountant must pass the uniform national CPA exam, be licensed by the State, complete 120 hours of continuing education every three years, and be subjected to a quality review or peer review of his accounting practice every three years.
Same holds true in most if not all states in the US.

I don't understand your best option. What or who is a reliable consultancy?
I suppose you are saying to assign jobs to reliable consultants to manage these (tasks?) with minimum headaches for us?

"These" being the payroll functions (processing or filings) for instance?

I agree that if you are outsourcing this function it's best to go with a payroll company (ADP, Paychex or a slew of other companies large and small) rather that use an accountant. To use an accountant to do this is a waste of your money.

How about the job of income tax return preparation? Who's a reliable consultant in this field? One of them self proclaimed accountants? :rolleyes:

How about if the bank or bonding company calls for a financial statement for your business? Who's a reliable consultant for that job? One of them self proclaimed accountants? :rolleyes:

If I misunderstand your comments, I'm sorry.
But you struck a nerve.;)