2022 Q1 Form 941 Revisions
Form 941, Employer’s Quarterly Federal Tax Return, is a federal form employers must use to report income taxes, social security tax, or Medicare tax withheld from employee’s paychecks. Employers also use Form 941 to report their own portion of these taxes.
The IRS has released changes to Form 941 for the first quarter of 2022.
Here is an overview of all the expected changes to Form 941 for Q1:
2022 Deadlines for Form 941
IRS Form 941 is due to the IRS quarterly. These are the 941 due dates for the 2022 tax year:
- First Quarter (January – March): May 2, 2022
- Second Quarter (April – June): August 1, 2022
- Third Quarter (July – September): October 31, 2022
- Fourth Quarter (October – December): January 31, 2023
2022 Quarter 1 Form 941 Updates
Social Security and Medicare Tax for 2022
The rate of social security tax on taxable wages, including qualified sick leave wages and qualified family leave wages paid in 2022 for leave taken after March 31, 2021, and before October 1, 2021, is 6.2% each for the employer and employee or 12.4% for both.
Qualified sick leave wages and qualified family leave wages paid in 2022 for leave taken after March 31, 2020, and before April 1, 2021, aren’t subject to the employer share of Social Security tax; therefore, the tax rate on these wages is 6.2%. The social security wage base limit is $147,000.
The social security wage base limit for 2022 is increased to $147,000 (up from $142,800). The Medicare tax rate remains at 1.45% and is unchanged from 2021. There is no wage base limit for Medicare tax.
Qualified Sick and Family Leave Credits
The credit for qualified sick and family leave wages, as enacted under the FFCRA for leave taken after March 31, 2020, and before April 1, 2021, has expired. The credit for qualified suck and family leave wages under sections 3131, 3132, 3133 of the Internal Revenue Code, as enacted under the ARP, for leave taken after March 31, 2021, and before October 1, 2021, has expired.
The credit for qualified sick and family leave credits is now limited to employers that pay qualified sick and family leaves wages in 2022 for leave taken after March 31, 2020, and before Oct 1, 2021.
COVID-19 Employee Retention Credit
The employee retention credit was limited to qualified wages paid after March 12, 2020, and before July 1, 2021. The employee retention credit under section 3134 of the Internal Revenue Code was limited to wages paid after June 30, 2021, and before October 1, 2021. These credits have now expired.
COBRA Premium Assistance
Credit for COBRA premium assistance payments is limited to periods of coverage beginning on or after April 1, 2021, through periods of coverage beginning on or before September 30, 2021. A premium payee is entitled to the COBRA premium assistance credit at the time an eligible individual elects coverage. Generally employers have 60 days to provide notice and assistance eligible individuals have 60 days to elect coverage. Therefore, due to the COBRA notice and election period requirements, some employers may be eligible to claim the COBRA premium credit on employment tax returns for the first quarter of 2022.
Advance Payment of COVID-19 Credits Ended
While you can still pay qualified sick and family leave wages in 2022 for leave taken after March 31, 2020, and before October 1, 2021, or provide COBRA premium assistance payments in the first quarter of 2022, you may no longer request an advance payment of any credit on Form 7200.
The Following field have been updated on Form 941
| Line No. | 2022 Q1 Form 941 | 2021 Q4 Form 941 |
| Line 11c | Reserved for future use | Non Refundable portion of employee retention credit |
| Line 13d | Reserved for future use | Refundable portion of employee retention credit |
| Line 13h | Reserved for future use | Total advances received from filing Form 7200 for the quarter |
| Line 13i | Reserved for future use | Total deposits and refundable credits less advances |
| Line 18 | Indicate that you are a seasonal employer that doesn’t have to file a return for every quarter of the year | Line 18a:Indicate that you are a seasonal employer and you don’t have to file a return for every quarter of the year Line 18b:If you are eligible for the employee retention credit solely because your business is a recovery startup business |
| Line 21 | Reserved for future use | Qualified wages for the employee retention credit |
| Line 22 | Reserved for future use | Qualified health plan expenses for the employee retention credit |
Form 941 Worksheets for Q1, 2022
Worksheet 1:
To calculate the Credit for qualified sick and family leave wages paid in 2022 for leave taken after March 31, 2020, and before April 1, 2021.
Worksheet 2:
To calculate the Credit for qualified sick and family leave wages paid in 2022 for leave taken after March 31, 2021, and before October 1, 2021.
Worksheet 3:
COBRA Premium Assistance Credit can be calculated using this worksheet.
The IRS updated the forms to reflect the expiration of COVID-19 related relief provisions at the end of 2021.
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