IRS Updates Substitute Form 941, Schedules, and 8974 Specifications

The IRS has released updated guidance for specifications for substitute Form 941 (Employer’s Quarterly Federal Tax Return), Schedule B (Form 941), Schedule R (Form 941), and Form 8974 (Qualified Small Business Payroll Tax Credit for Increasing Research Activities) [Rev Proc 2024-11, 2024-13 IRB; IRS Publication 4436 (Rev. March 2024)].

Background.

The guidance provides general rules and specifications from the IRS for paper and computer-generated substitutes for the above forms. The IRS cautions that prior to creating a substitute Form 941, employers should view IRS Publication 1167 (General Rules and Specifications for Substitute Forms and Schedules) for additional rules and specifications for payment vouchers, printing in margins, and additional instructions. The IRS also explains that failure to produce acceptable substitutes of the forms and schedules listed in this revenue procedure may result in delays in processing as well as penalties.

What’s New.

The guidance notes the following changes:

• Form 941 was revised to delete all lines related to the credit for qualified sick and family leave wages. Additionally, all lines that were previously “Reserved for future use” have been deleted. Form 941 is now a two-page form instead of a three-page form. See also 2024 Form 941, Schedules, and Instructions Released (02/28/2024).
• The Privacy Act and Paperwork Reduction Act Notice was removed from Form 941. The Privacy Act and Paperwork Reduction Act Notice is now in the Instructions for Form 941.
• Forms 941-SS and 941-PR were discontinued after 2023. Employers in the U.S. territories will file Form 941, or if they prefer their form in Spanish, they can file a new Form 941 (sp).

For further information regarding Form 941 and schedules, see Payroll Guide ¶4225.