Correcting Payroll Form 941

Employers are required to submit Form 941 each quarter. Occasionally, however, errors occur when processing the information to complete the form. If an error is made on a submitted Form 941, it must be corrected. The correction is reported on Form 941-X. In 2009, the IRS introduced a new Form to the 941 series of Forms, Form 941-X. This form is used to report errors on a previously filed Form 941. The Form 941-X replaces Forms 941c and 843 (for a portion of the purpose of Form 843). Since 2009, employers must use Form 941-X to report any corrections on previous quarters. Form 941-X is to be used to request a refund or abatement of overreported federal employment taxes. Form 843 is still used to request a refund or abatement of assessed interest or penalties. If an error is discovered on a previously filed Form 941, the correction can be made on Form 941-X Adjusted Employer's Quarterly Federal Tax Return or Claim for Refund. The Form 941-X is an amended return and is filed separately from Form 941. For more information see section 13 of IRS Publication 15. Form 941 no longer provides adjustment lines for correcting prior quarter errors. Only current quarter adjustments for fractions of cents, third-party sick pay, tips and group-term life insurance will continue to be reported on Form 941 as discussed in that section of this course. For an HR Generalist, ensuring human resources compliance in tax reporting is essential to avoid labor law penalties. The Form 941-X is used to report a correction of underreported and overreported amounts for the same tax period on a single Form 941-X. If an employer is requesting a refund or abatement and reporting a correction for both underreported and overreported amounts, file one Form 941-X correcting the underreported amounts only and a second Form 941-X correcting the overreported amounts. Do not use Form 941-X to report corrections to Forms CT-1, 943, 944, 944-SS or Form 945. Each of these Forms has a corresponding Form X (CT-1 X, 943-X, 944-X and 945-X). The purpose of Form 941-X is to correct errors previously reported on Form 941. Employers should use Form 941-X to correct previously reported:

• Wages, tips, and other compensation under FLSA standards
• Income tax withheld from wages, tips and other compensation
• Taxable social security wages
• Taxable social security tips
• Taxable Medicare wages and tips

If an employer did not file a Form 941 for one or more quarters, then Form 941-X is not used. Instead, the employer should file Form 941 for each applicable quarter.