Note: In this chapter and in all succeeding work throughout the course, unless instructed otherwise, use the following rates, ceiling, and maximum taxes.

Employee and Employer OASDI:	6.20%	$118,500	$7,347
Employee* and Employer HI:	1.45%	No limit	No maximum
Self-employed OASDI:	12.4%	$118,500	$14,694
Self-employed HI:	2.9%	No limit	No maximum

1.	Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the over-time rate).
2.	If the third decimal place is 5 or more, round to the next higher cent.
3.	If the third decimal place is less than 5, simply drop the third decimal place.
	Examples:	Monthly rate $1,827 Weekly rate ($1,827 12)/52 = $421.615 rounded to $421.62 Hourly rate $421.62/40 = $10.540 rounded to $10.54 O.T. rate $10.54 1.5 = $15.81

Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.

*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.

Figure 3.8

During the third calendar quarter of 20--, Bayview Inn, owned by Diane R. Peters, employed the persons listed below. Also given are the employees' salaries or wages and the amount of tips reported to the owner. The tips were reported by the 10th of each month. The federal income tax and FICA tax to be withheld from the tips were estimated by the owner and withheld equally over the 13 weekly pay periods. The employer's portion of FICA tax on the tips was estimated as the same amount.

	Salary or		Quarters		Quarters		Quarters		Quarters		Quarters
Employee	Wage		Wages		Tips		OASDI		HI		FIT
Grant Frazier	$58,240/year		$14,560.00				$902.72		$211.12		$850.00
Joseph LaVange	20,800/year		5,200.00				322.40		75.40		549.00
Susanne Ayers	265/week		3,445.00		$2,258.70		353.63		82.70		529.00
Howard Cohen	210/week		2,730.00		2,411.30		318.76		74.55		611.00
Lee Soong	240/week		3,120.00		2,662.50		358.52		83.85		651.00
Mary Yee	245/week		3,185.00		2,690.30		364.27		85.19		662.00
Helen Woods	335/week		4355.00				270.01		63.15		430.00
Koo Shin	340/week		4,420.00				274.04		64.09		539.00
Aaron Abalis	385/week		5,005.00				310.31		72.57		691.00
David Harad	185/week		2,405.00				149.11		34.87		235.00
			$48,425.00		$10,022.80		$3,623.77		$847.49		$5,747.00

Employees are paid weekly on Friday. The following paydays occurred during this quarter:

July	August	September
5 weekly paydays	4 weekly paydays	4 weekly paydays

Taxes withheld for the 13 paydays in the third quarter follow:

Employees	Weekly			Weekly
Federal Income Tax	FICA Taxes Withheld on Wages			FICA Taxes on Tips
	OASDI		HI	OASDI		HI
$442.08 per week	Employees	$230.95	$54.01	Employees	$47.80	$11.18
	Employers	230.95	54.01	Employers	47.80	11.18

Note: Lines 5a and 5c of Form 941, tax on total taxable wages, are computed by multiplying by the combined tax rate for both employer and employee. Small differences due to rounding may occur between this total and the total taxes withheld from employees each pay period and the amount of the employer's taxes calculated each pay period. This difference is reported on line 7 as a deduction or an addition as "Fractions of Cents." Use a minus sign to indicate a deduction. Assume that company deposits taxes on monthly basis.

Form 941 for 20--: (Rev. January 2016)

Employer's QUARTERLY Federal Tax Return Department of the Treasury Internal Revenue Service

OMB No. 1545-0029

Employer identification number (EIN)

0

0

0

0

0

3

6

0

7

Name (not your trade name)

DIANE R. PETERS

Trade name (if any)

BAYVIEW INN

Address

404 UNION AVE.

Number

Street

Suite or room number

MEMPHIS

TN

38112

City

State

ZIP code

Foreign country name

Foreign province/county

Foreign postal code

Report for this Quarter of 20-- (Select one.)

Instructions and prior year forms are available at www.irs.gov/form941.

Read the separate instructions before you complete Form 941. Type or print within the boxes.

Part 1:

Answer these questions for this quarter.

1

Number of employees who received wages, tips, or other compensation for the pay period including: Mar. 12 (Quarter 1), June 12 (Quarter 2), Sept. 12 (Quarter 3), or Dec. 12 (Quarter 4)

1

2

Wages, tips, and other compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2

3

Federal income tax withheld from wages, tips, and other compensation . . . . . . . . . . . . . . . . . . . . . . . . .

3

4

If no wages, tips, and other compensation are subject to social security or Medicare tax

Check and go to line 6.

		Column 1		Column 2
5a	Taxable social security wages . . . . .		x .124 =
5b	Taxable social security tips . . . . . . . .		x .124 =
5c	Taxable Medicare wages & tips . . . . .		x .029 =
5d	Taxable wages & tips subject to Additional Medicare Tax withholding		x .009 =

5e

Add Column 2 from lines 5a, 5b, 5c, and 5d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5e

5f

Section 3121(q) Notice and DemandTax due on unreported tips (see instructions) . . . . . . . . . . . . . . .

5f

6

Total taxes before adjustments. Add lines 3, 5e, and 5f . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6

7

Current quarter's adjustment for fractions of cents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

8

Current quarter's adjustment for sick pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8

9

Current quarter's adjustments for tips and group-term life insurance . . . . . . . . . . . . . . . . . . . . . . . . . . .

9

10

Total taxes after adjustments. Combine lines 6 through 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10

11

Total deposits for this quarter, including overpayment applied from a prior quarter and overpayments applied from Form 941-X, 941-X (PR), 944-X, or 944-X (SP) filed in the current quarter . .

11

12

Balance due. If line 10 is more than line 11, enter the difference and see instructions . . . . . . . . . . . . . . . . . . . .

12

13

Overpayment. If line 11 is more than line 10, enter the difference Check one: Apply to next return. Send a refund.

You MUST complete both pages of Form 941 and SIGN it.

Next

For Privacy Act and Paperwork Reduction Act Notice, see the back of the Payment Voucher.

Cat. No. 17001Z

Form 941 (Rev. 1-2016)

Name (not your trade name)	Employer identification number (EIN)
DIANE R. PETERS	00-0003607

Part 2:

Tell us about your deposit schedule and tax liability for this quarter.

If you are unsure about whether you are a monthly schedule depositor or a semiweekly schedule depositor, see section 11 of Pub. 15.

14 Check one:

a.

Line 10 on this return is less than $2,500 or line 10 on the return for the prior quarter was less than $2,500, and you did not incur a $100,000 next-day deposit obligation during the current quarter. If line 10 for the prior quarter was less than $2,500 but line 10 on this return is $100,000 or more, you must provide a record of your federal tax liability. If you are a monthly schedule depositor, complete the deposit schedule below; if you are a semiweekly schedule depositor, attach Schedule B (Form 941). Go to Part 3.

b.

You were a monthly schedule depositor for the entire quarter. Enter your tax liability for each month and total liability for the quarter, then go to Part 3.

Tax liability:	Month 1
	Month 2
	Month 3
Total liability for quarter			Total must equal line 10.

c.

You were a semiweekly schedule depositor for any part of this quarter. Complete Schedule B (Form 941), Report of Tax Liability for Semiweekly Schedule Depositors, and attach it to Form 941.

Part 3:

Tell us about your business. If a question does NOT apply to your business, leave it blank.

15

If your business has closed or you stopped paying wages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Check here, and
enter the final date you paid wages	/ /	.

16

If you are a seasonal employer and you do not have to file a return for every quarter of the year . . . . . . . . . . . . . . . . . Check here.

Part 4:

May we speak with your third-party designee?

Do you want to allow an employee, a paid tax preparer, or another person to discuss this return with the IRS? See the instructions for details.

Designee's name and phone number

Select a 5-digit Personal Identification Number (PIN) to use when talking to the IRS.

Part 5:

Sign here. You MUST complete both pages of Form 941 and SIGN it.

Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

Sign your name here

Print your name here

Print your title here

Date

10/31/--

Best daytime phone

901-555-7959

Paid Preparer Use Only

Check if you are self-employed . . . .

Preparer's name

PTIN

Preparer's signature

Date

/ /

Firm's name (or yours if self-employed)

EIN

Address

Phone

City

State

ZIP code

Page 2

Form 941 (Rev. 1-2016) Source: Internal Revenue Service