Just as in previous tax years, 2009 brings new changes to the different payroll tax forms and regulations. Below is a summary of "What's New" for Form 941 2009.

Social Security Wage Base for 2009

Do not withhold social security tax after an employee reaches $106,800 in social security wages in 2009. For 2008 the limit was $102,000. There is no limit on the amount of wages subject to Medicare tax. Social security and Medicare payroll taxes apply to the wages of household workers you pay $1,700 or more in cash. Social security and Medicare taxes apply to election workers who are paid $1,500 or more. For employers using a payroll software, the correct SS Wage Base is automatically used when calculating taxes and generating payroll forms like 2009 941.

COBRA premium assistance payments credit

The American Recovery and Reinvestment Act of 2009 (ARRA) provides for premium reductions and additional election opportunities for health benefits under COBRA. Eligible individuals pay only 35 percent of their COBRA premiums and the remaining 65 percent is reimbursed to the coverage provider through a tax credit. Employers who make COBRA premium assistance payments for assistance eligible individuals are allowed a credit for the payments on Form 941.

Employers, use line 12a of 941 2009 to report the COBRA premium assistance payments you made. Only report the premium assistance payments you made for the assistance eligible individuals who have paid their reduced premiums. This amount should be 65% of the total COBRA premiums for assistance eligible individuals without regard to the reduction. Do not include any amounts paid to you by the COBRA assistance eligible individuals. For COBRA coverage provided under a self-funded plan, COBRA premium assistance payments are treated as having been made for each assistance eligible individual who pays 35% of the COBRA premium.

Correcting a previously filed Form 941

If you discover an error on a previously filed Form 941, make the correction using the new payroll form, 941-X. The IRS has developed Form 941-X, Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund, to replace Form 941c, Supporting Statement to Correct Information. Use Form 941-X to make corrections to previously filed Forms 941. Do not attach Form 941-X to Form 941; file Form 941-X separately.

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