Asked in Employment Law, Tax Law and Business Law for Wyoming

Q: Do we have to file Form 941 and Form 940 if we have independent contractors only (no employees) in our Wyoming LLC?

We have a Wyoming LLC with independent contractors, no employees. Form SS-4 for EIN says to file Form 941 and Form 940 by January 31. We like to know if this is required if we have independent contractors only. We don’t have tax payments.

1 Lawyer Answer
James L. Arrasmith
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  • Tax Law Lawyer
  • Sacramento, CA

A: No, if your Wyoming LLC only has independent contractors and no actual employees, then you would not have to file IRS Form 941 (Employer's Quarterly Federal Tax Return) or Form 940 (Employer’s Annual Federal Unemployment Tax Return).

The key factors here are:

- Independent contractors are self-employed individuals who receive IRS Form 1099 for their services. They are not classified as employees.

- Form 941 and 940 only need to be submitted if you have actual employees on payroll for whom you withhold taxes and pay employment taxes.

- For independent contractors paid on 1099 basis, there are no payroll tax withholdings or employer tax obligations, so no need to file employment-related returns.

So given your LLC does not have formal employees getting W-2s but only has independent contractors receiving 1099 tax forms, you can disregard the Form 941 and 940 filing requirement indicated on your SS-4 EIN application. Just submit the standard informational returns like 1099-NECs to report non-employee compensation payments made.

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