The Internal Revenue Service scrutinizes expenses that can and often are benefits to owners. The most common benefit is the use of a company owned car for personal travel including using the car to get to and from work. Owners would love to have this cost of travel paid by the company and deductible for tax purposes.
W-2 is the employee’s annual wage and tax statement; it reports the gross wages earned and taxes withheld during the calendar year. The employee uses the W-2 to report their income on their Form 1040.
Form 941 is the employer’s quarterly federal tax return. It reports how much federal income taxes were withheld; Social Security taxes and Medicare taxes that are due and how much was paid in deposits to the Internal Revenue Service. The report is filed every three months for each of the four calendar quarters.