This year, Form 941, the Employer's Quarterly Federal Tax Return, has been altered multiple times to compensate for COVID-19 related credits that need to be reported. Employers should know what has changed, and more importantly, which form to be using. The latest form to be used is Form 941 for 2021 revised June 2021. Along with the updates to the form, the Form 941 instructions have also been altered.
The latest revision of Form 941 features additional and altered lines in part 1 and part 3. These changes to Form 941 allow employers to claim the COBRA tax credits offered earlier in the pandemic. Many of the new or adjusted lines reference the "portion of credit for qualified sick and family leave wages for leave," depending on the date taken. According to the IRS Form 941 instructions, the date the leave was taken affects how much the wages should be taxed. Leave taken in the first quarter of 2021 is taxed at 6.2 percent, while leave taken after March 31, 2021, is to be taxed at 12.4 percent. You can learn more about the changes made to Form 941 at the IRS website.
The most recent version of Form 941, revised June 2021, should be used for the second, third, and fourth quarters of 2021. Since the deadline for filing Form 941 is the end of the month following the quarter, the next due date is July 31 for the second quarter reporting.
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