This is the third post in the Employment Tax Law series. This series is dedicated to presenting individuals, sole proprietorships, and small to large businesses with a basic understanding of employment taxes, including the risks and responsibilities associated with those taxes.
It is important that taxpayers make sure the correct Employer Identification Number (E.I.N.) is used for each Form 941. Using the incorrect E.I.N. can result in the assessment of penalties and further delays in the processing of the taxpayer’s return.
Should a taxpayer change addresses or names, notify the IRS immediately to avoid any issues with the processing of their returns. Please review Pub. 1635, Understanding Your E.I.N., to see if an application for a new E.I.N. is needed.
Make sure to check the appropriate box for the pertinent quarter. This will ensure the IRS properly accounts for the taxes withheld in each quarter. Seems like a basic rule, but this ministerial mistake trips up many taxpayers.
As for formatting, this is another potential trap for taxpayers, please be sure to complete the entries on the form as follows, to ensure accurate scanning and processing: