• The latest forms update isn’t installed
• Voided paychecks
• Payroll field settings changed after paychecks were created in the quarter
• Payroll formula edited after paychecks created in the quarter
• Payroll field amounts are manually changed when creating paychecks
• Saved a payroll check without Social Security and Medicare taxes for Employee, Employer, or both
• Incorrect pre-tax settings
• Taxes not assigned in Payroll settings

How to locate the employees that are affecting the 941 Fractions of Cents

1. Select Reports & Forms > Payroll > Exception Report.
2. Select the Tax to Check.
3. Print the Exception Report.
   Note:
   • Run the Exception Report for Social Security and Medicare for both the employee and employer
   • Don’t select the Prepare correcting entries option
4. Each employee that has a difference will need to have their Payroll Checks verified that the deductions are correct. Proceed to the next section.

Voided paychecks

1. Go to Lists, Employees & Payroll, Paychecks.
2. Set the Date Range to the first period of the quarter.
3. Click the Amount column header to sort lowest to highest.
4. Double-click any voided paychecks (Amount will be negative) to open the paycheck.
5. Delete the void paychecks; you’ll also need to delete the original paycheck. Void checks have the original check number followed by V; for example, check 100V is voiding check 100.
6. Repeat for each period in the quarter.
7. Close the list and re-run the 941.
   • If the box 7 amount is still too much, proceed to the next section

Correct the liability on the 941

1. Run the 941.
2. On the second page, choose your deposit schedule.
3. Minimize the 941; go to Reports & Forms, Payroll, and open the Tax Liability Report.
4. Click Options on the Tax Liability Report.
5. Check Show only totals and set the Date Range:
   • If you’re a monthly depositor, set the date range to the first month of the quarter
   • If you’re a semi-weekly depositor, set the date range to the first date with an amount on the Schedule B
6. Click OK.
7. Note the 941 Amount on the Tax Liability Report, and switch back to the 941.
8. Change the amount for the first month or date to match the 941 Amount from the Tax Liability Report.
9. Switch back to the Tax Liability Report.
10. If you’re a monthly depositor, repeat steps 4-8 for the next two months; if you’re a semi-weekly depositor, repeat steps 4-8 for each date that has an amount on the Schedule B.
11. Once completed, the 941 box 7 will be reduced to zero or a number within the normal range for that field.

Saved a payroll check without Social Security and Medicare taxes for Employee, Employer, or both

If the taxes are manually zeroed on payroll entry, the 941 Payroll Report's Box 7 will show the amount as a negative indicating that the taxes are owed. Consult with your CPA for advice of how to file 941 for Box 7 if taxes weren’t originally deducted from payroll entry.

Taxes not assigned in Payroll settings

1. Go to Maintain, Payroll, Reclassify and Rename Payroll Fields.
2. Select the tax in the Benefits Column.
3. Click the Tax button to move the payroll field to the Taxes column.
4. Select the appropriate Category.
5. Click Save.

941 frequently asked questions and troubleshooting

941 Schedule B shows incorrect amounts