941 Form and Covid wages (QTR 2 2021 and later)

The IRS has changed the way that Covid wages are reported on the Form 941. Taxable qualified sick and family leave wages for leave taken after March 31, 2021 are included on line 5a and taxed at 12.4% for social security tax purposes.

If you are reporting any qualified sick and family leave wages for leave taken before April 1, 2021, these wages are reported on lines 5a(i) and 5a(ii), and taxed at 6.2% for social security purposes.

Qtr 1 2021:

If you’re reporting any qualified sick and family leave wages for leave taken before April 1, 2021, these wages are reported on lines 5a(i) and 5a(ii), respectively, and taxed at 6.2% for social security tax purposes. For leave taken before April 1, 2021, the credit for qualified sick and family leave wages is reported on line 11b (nonrefundable portion) and, if applicable, line 13c (refundable portion). See How do I report COVID-19 wages on Form 941? (Qtr 1 2021)

After Qtr 1 2021:

For leave taken after March 31, 2021, the credit for qualified sick and family leave wages is reported on line 11d (nonrefundable portion) and, if applicable, line 13e (refundable portion); and the nonrefundable portion of the credit is against the employer share of Medicare tax. For more information, see the instructions for line 11b, line 11d, line 13c, and line 13e, later. Use Worksheet 1 to figure the credit for leave taken before April 1, 2021. Use Worksheet 3 to figure the credit for leave taken after March 31, 2021. For more information about the credit for qualified sick and family leave wages, go to IRS.gov/PLC. You will enter the amount on Worksheet 3 under Step 2. This will auto populate line 11D on the 941 form.

Please contact your tax professional, consultant or CPA for assistance with these forms.