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IRS Releases Revised Form 941-X, Instructions

BY: Jyme Mariani, Esq. | 09/15/21

The IRS released a revised Form 941-X, Adjusted Employer’s Quarterly Federal Tax Return or Claim for Refund, and its instructions. Both have a July 2021 revision date. The form was significantly revised to allow for correction of COVID-19-related employment tax credits reported on Form 941, Employer’s Quarterly Federal Tax Return, due to changes under the American Rescue Plan Act of 2021 (ARPA).

Which Version to Use

The instructions provide that employers will be able to use the revised instructions and the July 2021 revision of Form 941-X for all years for which the statute of limitations on corrections has not expired. The IRS advises using the specific instructions for Form 941 for the quarter that is being corrected since the Form 941-X instructions do not repeat all information included in the Form 941 instructions.

What’s New

New credits. The instructions now include a table of contents. The revised Form 941-X can now be used to report corrections to these COVID-19-related items reported on Form 941: paid qualified sick and family leave wages, the employee retention credit, and the COBRA premium assistance tax credit.

New worksheets. The instructions now include five worksheets to calculate additional credits. Worksheet 1 (the only worksheet in the previous version of the instructions) has also been updated. Third-party payers must complete each worksheet for each client for which it is applicable, on a client-by-client basis.

Leaving lines blank. If a line on Form 941-X does not apply, leave it blank. If corrections are for a quarter that began:

  • Before April 1, 2020, leave blank Lines 9, 10, 17, 18a, 24, 25, 26a, 28, 29, 30, 31, 32, 33a, 33b, and 34.
  • Before April 1, 2021, leave blank Lines 18b, 18c, 18d, 26b, 26c, 35, 36, 37, 38, 39, and 40.
  • Before July 1, 2021, leave blank Line 31b.

To learn more about federal and state laws, regulations, and information to keep your company's payroll operations in compliance, check out Payroll Source Plus!


Jyme Mariani, Esq., is Managing Editor of Payroll Currently and Payroll Information Resources for the APA.