Worksheet 1 for Form 941

I have same type of inquiry--use payroll enhanced version with quickbooks desktop. Manually have all numbers computed for worksheet 1 but no idea how to get entered in 941.  How do I get my worksheet 1 numbers into the 941 form i am needing to efile?

Hello there, @McKenzieBieker and @J Myers.

Tax Form 941 will populate automatically its data based on the paychecks you've entered in the system, there isn't a need to manually fill it in and you're unable to override all the amounts. You can read through this article to learn more: How QuickBooks Populates The 941?

But you can manually print a copy of this tax form directly from the IRS website so you all can manually enter your desired data. Here's an article you can read for ideas about how you can obtain a copy of your tax form: Quick links to federal tax forms.

Lastly, I've got you the following article below for ideas to help manage your payroll account and related tasks: Help Articles for QuickBooks Desktop Payroll.

If there's anything else that I can help you with, let me know in the comments. I'll be here to lend a hand.

I am being told that if the payroll items were not setup in quickbooks it will not calculate. Well we did not set up as we had no idea our receipts were going to fall below 50% of 2nd qtr 2019 and that we would be eligible.  Really there is NO way we are not alone on this issue. Who knew you were going to be eligible for a credit because your sales went in tank.  Even if people realized it had to be after some payrolls run.  We ran all of second quarter and need numbers to get to 941.

I didn't set up any new payroll items for employees being paid sick leave either.  Didn't have any idea I needed to so that QB would compute the worksheet 1.  I have just kept up with the couple of people who qualified and their wages.  I also printed one off IRS website.  Am I going to be able to override the figures on the 941

Did they ever give you a solution - I have the same problems

So how do you create the payroll items for qualified sick pay and family leave pay?  Last I checked QuickBooks didn't even have the option to create new payroll items for these.  So we can't override the form, but you can't create the payroll items you need in QuickBooks for you to do the form correctly either, that is just great.  Your solution is to do a manual 941........ this means W-2's will have to be done that way as well?  This is ridiculous.  Why are we paying for payroll service if QuickBooks can't get their act together to make this work out correctly???

Reply i got was to void and reenter all of payroll for second quarter after setting up the "retention Credit" accounts. Talk about ridiculous.  Should only take a couple days to get what I should be able to enter as overrides in quickbooks in minutes.  I have always liked quickbooks--this REALLY gives me second thoughts.

What is especially ridiculous is I am still one computing the $10000 limit so not like QB is computing anything for me.  

I am quite certain others struggling with this ridiculousness. Manual 941 is not the answer Intuit.

No they didn't

Exactly my feelings - Where and when was setting up new payroll items discussed.  They need to change the 941 where we can add and override fields so our W-2s will be correct

manual 941 is not the answer.  Intuit/QB needs to fix

Good morning, @jpsm. 

Thanks for joining this thread. I'm here to provide some clarification with creating payroll items for sick pay and family leave pay. 

First, you'll need to determine your employee's benefit and hourly rate and set up a liability and expense account for the paid leave. Then, create a payroll and tax item. Also, I suggest reaching out to an accountant for more help with identifying accounts and payroll item types for tax purposes. 

Once you've set up the accounts and employee's type, here's how to create an hourly payroll item:

1. Click the Employees menu, then Manage Payroll Items. 
2. Choose New Payroll Item.
3. Go to Custom Setup and then Next. 
4. Select the Payroll Item Type and choose Next. 
5. Pick the Wage payroll item types, then Next. 
6. Choose the item for regular, overtime, sick, or vacation pay and click Next. 
7. Key in a name, then Next. 
8. Select the correct Expense account, then Finish. 

For more detailed steps, you can refer to this article: How to track paid leave and sick time for the coronavirus. 

Feel free to comment below if you have any more questions. I'm always here to help. Have a good one!

If we received a PPP loan then filling out the 941 is very different.  I set up payroll items to process FMLA and Sick Leave for COVID purposes.  So quickbooks want to fill in lines that are really inappropriate because we received a PPP.  is there a way to tell quickbooks i got a PPP so it fills out the 941 appropriately.? 

If here to help means re-enter all of payroll not alot of help.

Thanks for joining on this thread, @BE7, and @J Myers.

I want to make sure the 941 form submitted to the IRS has accurate data. To ensure I can provide a timely solution, which specific lines on the return did QuickBooks asks you to fill-in?

 As mentioned by my @JonpriL, the information populated on the tax return is based on the paychecks created in QuickBooks. The deferred amounts for the first quarter will be reported on the employer’s second quarter for the 941 form.

The FMLA and sick leave amounts are reported on Line 5. I suggest you get in touch with the IRS for recommendations on how to reflect the PPP loan on the form.

For additional resources, let me share the Deferral of employment tax deposits and payments through December 31, 2020 guide. It addresses specific issues related to the deferral of deposit and payment of these employment taxes.

Please know the Community has your back. If you have any clarifications or other concerns, click the Reply button and add a comment. I’ll jump right back in to assist further. Have a good one.

THis is NOT on PPP. IT is on employee retention credit and it is lines 11c, 13d, 21 & 22 which QB will not let me override.  Makes NO SENSE to have to void 8 entire payroll and reenter them with different payroll items when I am still one responsible for stopping the credit at $10000 of wages & health using enhanced payroll.  Why are you controlling way payroll was entered.  Different payroll items do NOT affect the payroll paid and thus what is eligible for a credit.

I finally got this problem solved today.  I had set up a Covid-19 payroll list item and used it on my June payroll, but apparently it wasn't set up correctly.  After I set up the list item correctly, I went back to the paycheck for the employee that had Covid-19 pay and deleted the original Covid-19 pay and replaced it with the new payroll list item.  Once I did this, I went back to the 941 and everything had loaded correctly and the Worksheet 1 showed up.  However, one thing it did change was the taxes owed.  The 941 shows a refund owed because I had already paid the payroll taxes the day I ran payroll.  I selected the refund option on the 941 and everything is now in balance.

Here are the instructions I used to finally build the National Paid Leave list items for employees.  In our specific situation, we had an employee with Covid-19 who stayed home and did not work, so we paid him under 'National Paid Leave Employee'  Even though I had already ran payroll, I was able to go into the employees last paycheck and make the changes.  This fixed the issue with the 941.  It will calculate the Social Security, Medicare, and Federal Taxes saved on the 941 and it will also populate a Worksheet 1.  Hope this helps! 

Desktop Payroll.
With QuickBooks Desktop Payroll, you can ensure your employees have the money they need, and you comply with the Family First Coronavirus Response Act (FFCRA).
Important: If you previously set up any paid leave items under the FFCRA before 4/23/2020, you will need to make sure you're not set to pay the Employer Portion of Social Security for your new FFCRA payroll items. Also make sure you are paying only the employee portion of Social Security.
Note: If you use QuickBooks Desktop Payroll Assisted, you’ll need to contact support to be allowed to mark the Default button.
Select Employee at the top of the menu
Scroll down to Manage payroll items, Edit/view payroll items then select one of the National Paid Leave items you set up.
Select Next, until you come to the taxability screen, the select default button. This will set your taxability to unmark Employer Social Security.
Repeat for all National Paid Leave additions you set up.
Before you can pay your employees, you need to do a few things. Here's what to do.
Step 1: Determine your employee’s benefit and hourly rate
Before you can give your employees this sick leave, you first need to figure out what pay leave type they fall under and their hourly rate.
Benefit type
Under the FFCRA, there are three different types of paid leave. Employers can also geta credit for any health insurance premiums they pay for impacted employees while they are on leave.
National Paid Leave Employee: Your employee is sick and under quarantine with COVID-19.
National Paid Leave Family: Your employee is taking care of a family member who is sick or impacted with COVID-19.
National Paid Leave FMLA: Your employee is taking leave under the Family Medical Leave Act (FMLA) to care for children under 18 whose school or child care is closed because of COVID-19.
National Paid Leave - Health Credits: If you are contributing to an employee’s health insurance during the time they are being paid under the FFCRA provisions, you can track this amount and a credit will be applied to your federal tax liability.
Hourly rate
In most cases, you'll pay your employee the hourly rate you've paid them over the last 6 months. However, there are a few exceptions that correspond with the Regular Rate of Pay Under the Fair Labor Standards Act (FLSA).
Employees on commission: You need to create an hourly rate for them. Their hourly rate under the FFCRA needs to be equal to the commission paid over the last 6 months divided by their hours worked in the 6 month period.
Tipped Employees: You'll need to ensure you include your employees tipped income when entering their paid leave or FMLA expansion pay. Review the amount of income they received over the last six months. Then average it out over the number of hours they worked in the same period. You'll need to change the employee's pay rate during this time and ensure you're paying them at least minimum wage required under the FLSA, your state, or local jurisdiction.
Step 2: Set up your expense accounts for the paid leave
Once you know what type of paid leave type is applicable to your employee’s situation, setting up this account will help track the eligible wages to use towards tax credits later on.
Go to the Lists menu, then select Chart of Accounts.
Select the Account ▼ dropdown, then select New.
Choose Expense, then select Continue.
From the Account Type dropdown, select Other Expense.
Give your expense account a name, such as COVID-19 Expenses, in the Name field, fill out all the relevant information, and select Save and Close.
Step 3: Set up payroll items
Once you set up your liability and expense accounts, you need to set up payroll items to track each type of paid leave found under the FFCRA that you identified in step 1.
National Paid Leave Employee and National Paid Leave Family
Go to the Employees menu, then Manage Payroll Items, then select New Payroll Item.
Select Custom Setup, then select Next.
Select Addition (Employee Loan, Mileage Reimbursement), then select Next.
Give your pay type a name, such as National Paid Leave EE or National Paid Leave Family, then select Next.
In the Expense account window, select COVID-19 Expenses (or whatever you named the expense account) and then select Next.
In the Tax tracking type window, select the paid leave type, such as National Paid Leave EE or National Paid Leave Family based on what you are setting up as the tax tracking type.
In the Taxes window, select Next.
In the Calculate Based on Quantity window, select Calculate this item based on Quantity, and then select Next.
In the Default Rate and Limit window, set the rate for the following items. The National Paid Leave Employee limit is $5110 and the National Paid Leave Family is $2000.
Ensure the Limit Type is Annual, restart each year, and then select Finish.
National Paid Leave FMLA
Go to the Employees menu, then Manage Payroll Items, then select New Payroll Item.
Select Custom Setup, then select Next.
Select Addition, then select Next.
Give your pay type a name, such as National Paid Leave FMLA, in the text field and select Next.
Select COVID-19 Expenses (or whatever you named the expense account) as the expense account, and then Next.
In the Tax Tracking type window, Select National Paid Leave FMLA, then Next.
In the Taxes window, select Next.
In the Calculate Based on Quantity window, select Neither, and then select Next.
In the Default Rate and Limit window, make sure the rate is at 0 and the limit is at $10,000, select One Time Limit from the Limit Type dropdown, and select Finish.
National Paid Leave - Health Premium
Go to the Employees menu, then Manage Payroll Items, then select New Payroll Item.
Select Custom Setup, then select Next.
Select Company Contribution, then select Next.
Give your company contribution a name, such as National Paid Leave - Health credits, and select Next.
On the Agency for company-paid liability screen, select COVID-19 Expenses from the Liability account dropdown, and select COVID-19 Expenses (or whatever you named the expense account) from the Expense account dropdown, and then select Next.
On the pop-up message to confirm you selected the same account, select Yes. Selecting the same account for Liability and Expense ensures your liabilities aren't overstated.
On the Tax tracking type window, choose National Paid Leave- Health, then select Next.
On the Taxes window, select Next.
In the Calculate Based on Quantity window, select Neither, and then select Next.
On the Default rate and limit window, make sure the rate is at 0.00 and then the limit is 10,000, and select One-time Limit from the Limit Type dropdown, select Finish.
National Paid Leave & Medicare Credit
Go to the Employees menu, then Manage Payroll Items, then select New Payroll Item.
Select Custom Setup, then select Next.
Select Company Contribution, then select Next.
Give your company contribution a name, such as National Paid Leave - Medicare, and select Next.
On the Agency for company-paid liability screen, select COVID-19 Expenses from the Liability account dropdown, and select COVID-19 Expenses (or whatever you named the expense account) from the Expense account dropdown, and select Next.
On the pop message to confirm you selected the same account, select Yes.
On the Tax tracking type window, choose National Paid Leave- Medicare, then select Next.
On the Taxes window, select Next.
In the Calculate Based on Quantity window, select Neither, and then select Next.
On the Default rate and limit window, make sure the rate is at 0.00 and then the limit 0, and select Annual, restart each year from the Limit Type dropdown, select Finish.
Step 4: Set up a new tax item
Once you’ve set up your payroll items, you’ll need to set up tax items to ensure you’re tracking the tax credits. These steps are the same for all Desktop Payroll versions.
Go to the Employees menu, then Manage Payroll Items, then select New Payroll Item.
Select Custom Setup, then select Next.
On the Payroll item type window, select Other Tax, then select Next.
On the Other Tax window, select National Paid Leave Credit, then select Next.
In the Name used in paychecks and payroll report window, enter National Paid Leave Credit in the text field, then select Next.
In the Agency for company-paid liability window, select the agency you pay taxes too from the dropdown, select COVID-19 Expenses in the Liability account dropdown, and select COVID-19 Expenses (or whatever you named the expense account) in the Expense account dropdown, and then select Next.
From the Taxable Compensation window, select Next.
In the Pre-tax deductions window, select the item that will reduce wages for this tax. Then select Finish.
Note: If National Paid Leave Credit isn't there, it means the item was already set up. Look for the item on your Payroll Item List, you may have changed the name.
Next steps with the FFCRA
Run a regular payroll
Review and claim your tax credits
After you’ve run your payroll with the paid leave, you should be aware of how it affects your taxes. Under the FFCRA, you’ll get credit towards your Federal Tax deposit for the wages and Employer Paid Health Insurance premiums paid under this act.
To ensure you’ve been tracking the leave correctly, you can review your payroll reports to see how many hours you’ve used in these tax credits.
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Could you please tell me which line of the 941 form the FFCRA wages show up on?Meaning 11B, 13C or ??

Also did you list the sick wages under 51 (1) ?

Thanks

Once I corrected the Payroll Item and repopulated the 941, the FFCRA wages showed up on line 11b (this line item also included the Medicare amount saved, so it was a total of that number and the total wages.)  However, it also filled in my line 5a (I) Column 1 and Column 2.

Once I finished the 941 and Schedule B, it also shows a completed Worksheet 1.

do you by chance have a 401K plan QB not calculating 401K withholding on accounts that QB had me set up.  I think it is because it is an "addition" account and not wages.

Also were you able, or did you have employees you ONLY paid health for and no Wages? It won't let me enter these

I think you're right. I had to manually enter the 401k contribution for the employee and I also had to edit the employer contribution.  I couldn't figure out how to get the payroll item set up to do it automatically, so I gave up.

I didn't bother with the Health Insurance credit because it seemed to be more work than it was worth. We pay on a monthly basis and the employee was only gone for a few days during the pay period, so I wasn't even sure how to calculate the savings.

You enter that amount of credit on the interview page of the 941.  I am speaking to Intuit currently to see why the Worksheet is not included.

Thank you for your very helpful comments. I am following them to get the Employee Retention Credit for Q 2 by adding the Payroll Items in Quickbooks. And yes, that does make a difference in the 941 where the qualified wages show up in the Worksheet. However, when I preview the W-2 for 2020, I see that taxable wages are decreased by the amount of Emp Ret Credit, with no place that shows ERC wages.  Could this be correct?  Perhaps Quickbooks hasn't worked on the 2020 W2's yet and there will be an additional field that shows both type of wages correctly.

So basically you are saying we have to do this report manually even if we set up the correct items in Quickbooks, like FMLA, and National Paid Sick Leave?