Example 3-2

Wallington Company has 100 employees, each earning $525.25 a week.

OASDIAmount of OASDI tax withheld from each employee's paycheck each week:$32.57(6.2% $525.25)Total tax withheld from the 100 employees' wages:$3,257.00($32.57 100)Tax on employer:$3,256.55[6.2% ($525.25 100)]HIAmount of HI tax withheld from each employee's paycheck each week:$7.62(1.45% $525.25)Total tax withheld from the 100 employees' wages is:$762.00($7.62 100)Tax on employer:$761.61[1.45% ($525.25 100)]

Example 3-6

1. On Friday, May 24, 20--, Rogers, Ltd., a semiweekly depositor, pays wages and accumulates employment taxes. Rogers makes a deposit on Wednesday, May 29, in the amount of $4,000. Later it was determined that Rogers was actually required to deposit $4,080 by Wednesday.

Rogers has a shortfall of $80. The shortfall is less than the greater of $100 or 2 percent of the amount required to be deposited. Therefore, Rogers satisfies the safe harbor rule so long as the $80 shortfall is deposited by Wednesday, June 19.

2. On Friday, October 4, 20--, Vargan Company, a semiweekly depositor, pays wages and accumulates employment taxes. Vargan makes a deposit of $30,000 but later finds that the amount of the deposit should have been $32,000.

The $2,000 shortfall ($32,000 - $30,000) exceeds the greater of $100 or 2 percent of the amount required to be deposited (2% $32,000 = $640). Thus, the safe harbor rule was not met. As a result, Vargan is subject to a failure-to-deposit penalty, as described later in this chapter.

The taxable wages and withheld taxes for Hamilton Company (EIN 00-0001462), semiweekly depositor, for the first quarter of 20-- follow. Hint: To calculate liability for each date, multiply gross wages by FICA rate [to get employer's share of FICA]. Then add employee's withholding OASDI, HI and FIT.

Semimonthly PaydaysGross and Taxable WagesFICA Withheld OASDIFICA Withheld HIFederal Income Tax Withheld1/15$34,200$2,120.40$495.90$4,180.001/3132,9002,039.80477.054,090.002/1531,7501,968.50460.383,996.002/2828,9701,796.14420.073,797.003/1528,8001,785.60417.603,790.003/2929,4001,822.80426.303,999.00$186,020$11,533.24$2,697.30$23,852.00

a. Complete Schedule B of Form 941 for the first quarter for Harry Conway, the owner of Hamilton Company. If a box does not require an amount, leave it blank. Round your answers to the nearest cent.

Schedule B (Form 941):Report of Tax Liability for Semiweekly Schedule Depositors^{(Rev. January 2017)Department of the Treasury Internal Revenue Service}Employer identification number (EIN)000001462Name (not your trade name)HARRY CONWAYCalendar year20162017201820--20--(Also check quarter)_{OMB No. 1545-0029}Report for this Quarter... (Select one.)January, February, MarchApril, May, JuneJuly, August, SeptemberOctober, November, DecemberJanuary, February, MarchUse this schedule to show your TAX LIABILITY for the quarter; don't use it to show your deposits. When you file this form with Form 941 or Form 941-SS, don't change your tax liability by adjustments reported on any Forms 941-X or 944-X. You must fill out this form and attach it to Form 941 or Form 941-SS if you're a semiweekly schedule depositor or became one because your accumulated tax liability on any day was $100,000 or more. Write your daily tax liability on the numbered space that corresponds to the date wages were paid. See Section 11 in Pub. 15 for details.Month 11fill in the blank 39fill in the blank 417fill in the blank 525fill in the blank 6Tax liability for Month 12fill in the blank 710fill in the blank 818fill in the blank 926fill in the blank 10fill in the blank 113fill in the blank 1211fill in the blank 1319fill in the blank 1427fill in the blank 154fill in the blank 1612fill in the blank 1720fill in the blank 1828fill in the blank 195fill in the blank 2013fill in the blank 2121fill in the blank 2229fill in the blank 236fill in the blank 2414fill in the blank 2522fill in the blank 2630fill in the blank 277fill in the blank 2815fill in the blank 2923fill in the blank 3031fill in the blank 318fill in the blank 3216fill in the blank 3324fill in the blank 34Month 21fill in the blank 359fill in the blank 3617fill in the blank 3725fill in the blank 38Tax liability for Month 22fill in the blank 3910fill in the blank 4018fill in the blank 4126fill in the blank 42fill in the blank 433fill in the blank 4411fill in the blank 4519fill in the blank 4627fill in the blank 474fill in the blank 4812fill in the blank 4920fill in the blank 5028fill in the blank 515fill in the blank 5213fill in the blank 5321fill in the blank 5429fill in the blank 556fill in the blank 5614fill in the blank 5722fill in the blank 5830fill in the blank 597fill in the blank 6015fill in the blank 6123fill in the blank 6231fill in the blank 638fill in the blank 6416fill in the blank 6524fill in the blank 66Month 31fill in the blank 679fill in the blank 6817fill in the blank 6925fill in the blank 70Tax liability for Month 32fill in the blank 7110fill in the blank 7218fill in the blank 7326fill in the blank 74fill in the blank 753fill in the blank 7611fill in the blank 7719fill in the blank 7827fill in the blank 794fill in the blank 8012fill in the blank 8120fill in the blank 8228fill in the blank 835fill in the blank 8413fill in the blank 8521fill in the blank 8629fill in the blank 876fill in the blank 8814fill in the blank 8922fill in the blank 9030fill in the blank 917fill in the blank 9215fill in the blank 9323fill in the blank 9431fill in the blank 958fill in the blank 9616fill in the blank 9724fill in the blank 98Fill in your total liability for the quarter (Month 1 + Month 2 + Month 3) Total liability for the quarterTotal must equal line 12 on Form 941 or Form 941-SS.fill in the blank 99For Paperwork Reduction Act Notice, see separate instructions.IRS.gov/form941Cat. No. 11967QSchedule B (Form 941) (Rev. 1-2021) Source: Internal Revenue Service

b. Using the calendar below, list the due dates of each deposit in the first quarter.

PaydaysDeposit Due DatesJanuary 15January 20January 18February 1February 20January 20January 31February 3February 6February 7February 25February 3February 15February 20February 21March 3March 8February 20February 28March 3March 12March 6March 18March 3March 15March 20March 21April 2May 12March 20March 29May 12April 3April 15April 29April 3