What if the 941 Report does not match the Pay Code Transaction Report?
The employee contribution should match the employer contribution for Social Security and Medicare. If the employee contribution does not match the employer contribution, check to see if the employee was terminated. The 941 Report requires that the termination date is recorded as the last day the employee received a payroll check.
Example: If an employee was terminated on October 10th but the employee didn't receive their final payroll check until October 20th, the employee's termination date that is recorded in Payroll should be October 20th. It's important to use the final payroll check date as the termination date because the Pay Code Transaction Report uses the transactions that are tied to the employee's final payroll check while the 941 Report uses the employee's termination date to calculate amounts.
If the termination date occurs before the employee's last payroll check, the 941 Report will not include the employee's last payroll check and any other transactions that occurred after the termination date.
That's why the termination date needs to match the date on the employee's last payroll check.
Copyright © 2025 Caselle, Incorporated. All rights reserved.
Related Articles
Webinar: Step 3F. Pay code transaction report, Box 12 codes (02m07s)
The pay code transaction report can help you review pay codes for the calendar year, including health insurance pay codes. This webinar will show you how to set up a pay code transaction report and how to use it to find the information you need to ...
What if the employee is exempt from Federal and State withholdings and their pay code is inactive?
If the 941 Federal Tax Amount does not match the Pay Code Transaction Amount or the Employee Tax Summary Amount, check to see if there's a pay code at the employee level (Payroll > Employees > Modify Existing Employees) that is set to do not ...
2a. Verify pay code rates and limits
Start by reviewing the rates and limits for the employee and employer portions on the Social Security and Medicare pay codes that the Payroll application will use to calculate amounts to close the payroll year. And then, review the rates and limits ...
Which report shows terminated employees?
To review the employee termination dates, you can print the Employee List for terminated employees. You can use the terminated employees report to verify that all of the employees who were employed by the organization for the entire calendar year are ...
Step 2. Verify the pay code information
Carefully review the information stored in the Pay Codes table. The application uses the pay codes stored in the Pay Code table to calculate employee and employer amounts on quarterly reports, annual reports, W-2s, and so on. Watch a video Getting ...