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The IRS has revised Form 941 beginning with the filing of the 2nd Quarter of 2020, in conjunction with reporting the various Covid-19 tax credits and deductions. Please use this as a reference to assist in reviewing the information that has been filed on Form 941 by your company or your payroll provider.
If these amounts below are not reflected properly, an amended 941 should be filed to obtain the proper relief you are entitled to under the FFCRA Wages and CARES Act Wages.
Qualified Sick Leave, Qualified Family Leave & Employee Retention Credit
If you paid any employee Qualified Sick Leave or the Qualified Family Leave Wages, you will also want to be sure that you obtained relief from Qualified Health Plan Expenses allocable to these wages.
Additionally, if you elected the Employee Retention Credit, there is relief from Qualified Health Plan Expenses allocable to these wages.
Some key lines on the form if you are reporting wages for Qualified Sick Leave, Qualified Family Leave and Employee Retention Credit:
Wages will appear on lines:
| 5a | (i) Qualified sick leave wages |
| 5a | (ii) Qualified family leave wages |
| 21 | Qualified wages for the employee retention credit |
Health Plan Expenses will appear on lines:
| 19 | Qualified health plan expenses allocable to qualified sick leave wages |
| 20 | Qualified health plan expenses allocable to qualified family leave wages |
| 22 | Qualified health plan expenses allocable to employee retention credit wages |
If you have elected to defer any portion of the Employer Share of Social Security tax, these amounts will appear on lines:
| 13b | Deferred amount of the employer share of social security tax |
Record As Long-Term Liabilities
These amounts should be recorded on your balance sheet as Long-Term Liabilities since the payment is due 50% by December 31, 2021, and the remaining 50% is due by December 31, 2022.
MRPR’s Tax Planning & Compliance Team has spent years developing tax strategies for individuals and businesses that provide tax-saving opportunities year-round. Contact us for help with form 941 or any other tax planning and compliance issues that require our help.
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