What You Need to Know to File Form 941 for 2021


As an employer, there is a constant stream of tasks to accomplish, an endless “to do” list to conquer on a daily basis. One of the most significant sources of stress is maintaining your business’ IRS compliance, especially when you are a small employer wearing an assortment of hats. 

The fear of costly IRS penalties can be overwhelming in the best of times, but when you are trying to sustain your business through a year-long pandemic, it can be extremely daunting. 

Employers must file the Form 941 each quarter, therefore this is a particularly time consuming tax form. Whether you are just getting started filing this form, or you are curious if it has changed for the upcoming quarter, this article will help you complete your Form 941 successfully for the first quarter of 2021. 

What Is the Form 941 Used for?

Employers are required to withhold certain taxes from their employees’ wages, this includes federal income taxes, Medicare taxes, and social security taxes. The Form 941 is used to report these withholdings to the IRS. 

In the past year, the CARES Act was created to provide businesses with tax relief during the COVID-19 pandemic. Under the CARES Act, employers can claim tax credits for the employee retention credit and sick and family leave wages. These tax credits must be reported on the Form 941 as well. 

Adjustments to Form 941 for the First Quarter of 2021

The Form 941 has been revised and adjusted many times over the past year to reflect COVID-19 credits and social security deferral Now that the first quarter of 2021 is here, are there any new changes that employers must address?

The answer is yes, however the good news is that these are slight changes. The only notable change to Form 941 is the fact that employers no longer have the option to report social security deferements of either their share or their employees. This is because employers no longer have the option to do so. These changes can be found on Lines 13b and 24.

For example, a Presidential Memorandum from the last administration allowed employers to defer their employees’ share of social security between September 1, 2020 and December 31, 2021. This executive order was not reinstated by the current administration, and is no longer in effect. 

Tips for Filing Form 941 Successfully for Tax Year 2021

When it comes to completing the Form 941 this quarter, there are some easy ways to improve your filing experience and eliminate unnecessary stress. 

The first thing to take into account is the deadline to file your form. Be sure to plan ahead for each deadline so that you won’t be completing your Form 941 at the last minute. Start familiarizing yourself with the Form 941 for the first quarter deadline now, when there is still time to research it and consult a tax professional, if necessary. Please note each Form 941 deadline for the 2021 tax year. 

  • First quarter- April 30, 2021
  • Second quarter- July 31, 2021
  • Third quarter- October 31, 2021
  • Fourth quarter- January 31, 2022

If any of the deadlines fall over a weekend or on a federal holiday, the next business day becomes the deadline. 

Another way to eliminate the stress of filing is to switch from paper filing to electronic filing. This is an easy way to speed up the filing process and increase the security of your business’ sensitive information. If you are a semi-weekly depositor, required to file Schedule B, you are still able to do so when filing electronically. Additionally, you are able to get instant updates on the status of your form that you won’t receive if it is making its way to the IRS in the mail. 

Interested in finding a simple and secure e-filing solution for your Form 941? Check out TaxBandits for more information. 

Finally, if you are claiming any COVID-19 tax credits, be sure to use Worksheet 1 to help calculate the refundable and nonrefundable portions of these credits. This worksheet is a tool that the IRS created specifically for filers like you. 

Now that we have reviewed the purpose of Form 941 and the changes that may affect your business this quarter, we hope this information and these simple tips will help you feel more confident as you file for the first quarter of 2021!