How to Fill Out 941-X for the Employee Retention Credit

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If you’re like most business owners, it can sometimes seem like you’re drowning in a sea of paperwork. We don’t want to complicate your life any more than it already is, but we do want to bring to your attention what just might be the most important and profitable form you’ll fill out this year–Form 941-X for the Employee Retention Credit (ERC).

You’re probably familiar with the ERC, but just in case–the ERC was introduced under the CARES Act in 2020 and expanded in 2021. It provides businesses a refundable payroll tax credit if they were impacted by the COVID-19 pandemic.

For most businesses, the ERC program expired on September 30, 2021. However, qualifying companies have up to three years to claim the credit by filing an amended payroll tax return and completing a form to obtain the credit–Form 941-X.


How to Fill out Form 941-X

Many people know of the ERC, but don’t know how to fill out Form 941-X. Follow these instructions if you want to attempt to complete this form yourself:

  • Fill in the required details on the page header, such as the EIN, quarter, company name, and year.
  • Find which payroll quarters in 2020 and 2021 your association was qualified for.
  • For each quarter you prepare for, gather your earlier 941, payroll logs, and a blank 941-X.
  • Share information about your company. From the form, choose (941), as well as the quarter and year.
  • For the quarter, select the appropriate calendar year.
  • Choose the date when you first detected the errors on your 941 Form. 
  • Choose whether you’re filing an updated job tax return or a claim in Part 1; you’ll probably go with box 2.
  • In Part 2, check box 3. Then, in box 5d, state that the claim is for the tax that was not withheld from the employee’s pay.
  • On the second sheet, Line 18a, enter your non-refundable sum or ERC’s salary.
  • Then shift to Line 23 and add the sums on lines 7 through 22 of Column 4.
  • On the subsequent page, fill in your refundable share of the ERC.
  • Add the sum on the following page, Line 27, to the numbers on lines 23–26c of column 4.
  • In Line 30, add the qualified revenue for the ERC.
  • On Line 43, write a detailed description of how you got to your decision. For instance, changing a return to applying for ERC credits. Your refund check should be mailed to the contact shown on your account.
  • As needed, read and submit the last page of Part 5.

 For the 2020 ERC, the statute of limitations expires on April 15, 2024. For the 2021 ERC, ERC-941-X must be filed on or before April 15, 2025.

Form 941-X is an update of Form 941. It’s designed to help you update your 941 forms for 2020 and 2021. You need to change your Form 941 filed with the IRS in past quarters because you can now have both PPP loans and the ERC.

Bottom Line Concepts Can Help With Form 941-X

Bottom Line Concepts has guided over 16,000 businesses in completing Form 941-X and helped them recover almost $3 billion in credits. To learn more about how we can help you with the ERC, schedule a 15-minute no-cost consultation call with us today.

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