Checklist to Make Sure Your Business has Everything Necessary for the New 941

Checklist to Make Sure Your Business has Everything Necessary for the New 941

07/16/2020 Tags: Announcements, In the News, COVID-19


The IRS released the finalized version of the revised Form 941 — Employer’s Quarterly Federal Tax Return — in mid-June. Employers must use the revised form starting with Q2 2020. If you’re filing a late 941 for previous quarters, you’ll need to use the old form.

The new form contains nearly 20 additional lines and a new Worksheet 1. You’ll only need to fill out Worksheet 1 if you used any credits, but you don’t send Worksheet 1 along with your new 941.

It’s vital to maintain good records for all of the COVID-19-related credits and deferral programs your business has accepted or taken part in so you can make sure you’re filling out the 941 accurately.

To help you know what information you’ll need, we created the following checklist with a list of questions for you to answer to help you prepare your Q2 Form 941. You can also download the checklist here.

Mockup of COVID-19 Employers Guide PDF


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  • Did you pay anyone wages under the Family First Act? This includes paid sick leave and/or the expanded Family Medical Leave Act. If so, you’ll need:
    • Information about the wages you paid for Family First Act paid sick leave
    • Information about the wages you paid for the Family First Act expanded FMLA leave
    • Any information about employer-provided health insurance
    • Details about whether any of the payroll tax deposit was reduced by the paid leave amount
    • Did any government regulations force you to close because of the COVID-19 pandemic? If so, explain the details of your closure.
    • Did you have a noticeable decline in gross revenue in the first quarter of 2020 compared to the same time period in 2019?
      • If so, you’ll need to provide a current profit and loss statement and any other documentation showing a decrease in your revenues.
      • Also, if you had a significant reduction in revenue, you’ll need to have your books reconciled and all deposits and/or invoices recorded through June 30, 2020.
    • Did you have a noticeable decline in gross revenue in the second quarter of 2020 compared to the same time period in 2019?
      • If so, you’ll need to provide a current profit and loss statement and any other documentation showing a decrease in your revenues.
    • Did you elect to defer any payroll tax payments in 2020?
    • Did you pay less than the full payroll tax liability for any reason not covered above in 2020 (e.g. inability to pay because of the pandemic)?
    • Did you request any credit reimbursement on Form 7200?
      • If so, did you receive all funds?
      • If so, whoever fills out your 941 will need copies of your Form 7200.
    • Did you receive a Payroll Protection Program loan?
      • If so:
        • What date did you apply for a PPP loan?
        • What date did you receive your promissory note for the PPP loan?
        • What date did you receive funding from the PPP loan?
        • Did you use any of the funds used to pay paid sick leave or paid expanded FMLA leave under the Family First Act?
        • Are you planning to or have you already applied for loan forgiveness?
        • Provide a detail breakdown of where you spent the PPP funds (e.g. payroll, employee medical premiums employer portion, payroll taxes, utilities, rent or interest payments on mortgage, interest on debt obligations incurred before Feb. 15, 2020, etc.) and how much, if any, you have left.
    • Do you have concerns about your current cash flow or your ability to pay your obligations?
    • Have there been any other changes to your payroll or business that are worth noting?
    If you need help filing out the new Form 941 or have other questions, please let us know.


    This communication is intended to provide general information on legislative COVID-19 relief measures as of the date of this communication and may reference information from reputable sources. Although our firm has made every reasonable effort to ensure that the information provided is accurate, we make no warranties, expressed or implied, on the information provided. As legislative efforts are still ongoing, we expect that there may be additional guidance and clarification from regulators that may modify some of the provisions in this communication. Some of those modifications may be significant. As such, be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed.



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