Important 941 Information Regarding Deferred Payments and Tax Relief

Like the rest of the country, RFMS is adjusting to the new normal. Covid-19 has brought many changes, including a 941-quarterly report that has been completely revised to accommodate the tax relief available. We have discovered two anomalies in the 941-quarterly report in recent versions.  This information is applicable only if the corporation participated in any of the following:

• C.A.R.E.S (Corona Aid Relief and Economic Security Act) -> Retention Credit/Qualified Wages (addressed in 19.99.7)
• FFCRA (Families First Coronavirus Act) -> Qualified Sick/Family Leave Wages (addressed in 19.99.7)
• Deferment of Tax Payments (addressed in upcoming 19.99.8)

Please see the information below for each issue:

Part 1 / Line 5a

Excerpt from https://www.irs.gov/instructions/i941 - 5a. Taxable social security wages. Enter the total wages, including qualified wages (other than qualified health plan expenses) for the employee retention credit; sick pay; and taxable fringe benefits subject to social security taxes you paid to your employees during the quarter. Don't include the qualified sick leave wages reported on line 5a(i) or qualified family leave wages reported on line 5a(ii). For this purpose, sick pay includes payments made by an insurance company to your employees for which you received timely notice from the insurance company. See section 6 in Pub. 15-A for more information about sick pay reporting. See the instructions for line 8 for an adjustment that you may need to make on Form 941 for sick pay.

• Version 19.99.6 was including wages from 5a(i) and 5a(ii) on line 5a. 
   

Part 1 / Line 13a

Excerpt from https://www.irs.gov/instructions/i941 - 13a. Enter your deposits for this quarter, including any overpayment from a prior quarter that you applied to this return. Also include in the amount shown any overpayment that you applied from filing Form 941-X, 941-X (PR), 944-X, or 944-X (SP) in the current quarter. Don’t include any amount that you don’t deposit because you chose to defer the employer share of social security tax. For more information about the deferral, see the line 13b instructions next. Also, don’t include any amount you didn’t deposit because you reduced your deposits in anticipation of the credit for qualified sick and family leave wages or the employee retention credit, as discussed in Notice 2020-22.

• Both 19.99.6 and 19.99.7 included the deferred payments. 
   

Version 19.99.8 will be released before this report is due, however, if your corporation deferred payments and you wish to print the 941-Quarterly report before version 19.99.8 is available, please contact rfms-help@cyncly.com for additional information. 

As always, RFMS recommends that all tax forms are reviewed by your CPA before submitting.