On Saturday, August 8, 2020, President Trump signed an Executive Order which directs Treasury Secretary Mnuchin to defer withholding, deposit, and payment of the tax imposed by 26 U.S.C. §3101(a), and much of the tax imposed by 26 U.S.C. §3201, as is attributable to the rate in effect under 26 U.S.C. §3101(a), on wages or compensation, as applicable, paid during the period of September 1, 2020, through December 31, 2020. To read the full order, click here.
The AICPA has requested guidance from the Treasury Department and the IRS on the payroll tax deferral, and Sage is monitoring this closely. To learn more about the guidance request, click here.
We are waiting on guidance and clarifications from the Treasury Department and the IRS before determining our next steps.
UPDATE: Guidance for the recent Executive Order was received late Friday. Sage is reviewing to determine next steps. Read about the guidance here: https://www.irs.gov/pub/irs-drop/n-20-65.pdf
We are aware that the IRS posted a draft revision of Form 941 and we are reviewing it as well. The Form 941 draft is posted here: https://www.irs.gov/pub/irs-dft/f941--dft.pdf.
When attempting to process the quarter 3, 2020 941 in Federal and State Tax Reporting, you receive the following message after you select Next Step on page 2.
The IRS 941 form is still in draft and we will update the form upon release by IRS. In the interim, if you are on Payroll version 2.x, you are allowed to process payroll for the next quarter without closing the current quarter. If you are on legacy (version 2017 and prior) payroll, you must close current quarter before processing the next quarter payroll. Either version the 941 data will be retained for printing later.