Draft of April 2024 Version of Form 941-X and Instructions Released

The IRS released drafts of Form 941-X and its instructions with an April 2024 revision date.

Form 941-X.

Employers use Form 941-X to correct errors on a Form 941 that were previously filed. Examples of these corrections may include: wages, tips, and other compensation; income tax withheld from wages, tips, and other compensation; taxable Social Security wages; taxable Social Security tips; taxable Medicare wages and tips; and taxable wages and tips subject to Additional Medicare Tax withholding.

What’s New.

The instructions note the following items have changed:

• Lines 24 (formerly, Deferred amount of social security tax), 33a (formerly, Qualified wages paid March 13 through March 31, 2020, for the employee retention credit), 33b (formerly, Deferred amount of the employee share of social security tax included on Form 941 or 941-SS, line 13b), and 34 (formerly, Qualified health plan expenses allocable to wages reported on Form 941 or 941-SS, line 24) are now reserved for future use because the period of limitations on correcting these lines has generally expired for most employers. Overreported taxes may generally be corrected within the later of three years of the date the original Form 941 was filed or two years from the date the tax reported was paid. For lines 24 and 33b, the period of limitations for the deferred social security tax during the COVID-19 pandemic expired on April 15, 2024, for most employers. Lines 33a and 34 pertain to the employee retention credit and for most employers, the period of limitations for making corrections for qualified wages paid March 13, 2020, through March 31, 2020, generally expired April 15, 2024. However, line 18a and Worksheet 2 are retained. Taxpayers who believe the period of limitations is still open for correcting the second quarter 2020 Form 941 may still file the April 2023 revision of Form 941-X to use lines 33a and 34.
• COVID-19 qualified sick and family leave tax credits for leave taken after March 31, 2020, and before October 1, 2021, can no longer be claimed on Form 941. Generally, these tax credits have expired, however, employers that pay qualified sick and family leave wages in 2024 for leave taken after March 31, 2020, and before October 1, 2021, may claim the credit for these wages in 2024. The lines used to claim the credit on Form 941 were removed for tax periods beginning December 31, 2023, since it would be extremely rare that an employer would pay wages in 2024 for the qualified leave wages related to the COVID-19 tax credit period. The instructions explain that employers should file Form 941-X after filing Form 941, to claim the credit for qualified sick and family leave wages paid in 2024. Filing Form 941-X before filing Form 941 will result in processing errors and delays.
• Form 941-SS and Form 941-PR were discontinued after 2023. Employers in the impacted U.S. territories must use Form 941. Form 941-X is used to correct Form 941-SS or Form 941-PR filed for the fourth quarter of 2023 and earlier quarters.

See Payroll Guide ¶4225 and Payroll Guide ¶4275 for more information on Forms 941 and 941-X.