© 2021 American Payroll Institute, Inc. Inside this issue... IRS Provides Guidance on COBRA Premium Assistance Tax Credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 IRS Release Drafts of Form 941, Instructions, and Schedule R. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 IRS Updates Status of Processing Forms 941, 941-X. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 IRS Announces HSA Limits for 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 IRS Issues Guidance on Dependent Care Assistance Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 USCIS Extends E-Verify Records Disposal Date to June 4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 DHS Extends Temporary Requirements for Form I-9 Compliance Again . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 APA’s Payroll Tax Forum Starts in July. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Biden Administration Releases Fiscal 2022 Budget. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 IRS Announces Quarterly Interest Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Treasury Releases Report on the Biden’s Tax Compliance Agenda. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 E-Verify Redesigns Login Page. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Capital Hill Update . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 APA Updates Electronic Payments Guide. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 IRS Lists Errors to Avoid When Filing Employment Tax Returns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 IRS Publication Helps Employers With Worker Classification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Court Rules Employer Liable for Overtime Due to Incomplete Records. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Special Report: Panel Answers Questions at Congress Xstream Part 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 State and Local News. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 June 4, 2021 Volume 29 Issue 6 IRS Updates Form 7200, Instructions to Reflect Law Changes The IRS updated Form 7200, Advance Payment of Employer Credits Due to COVID-19, and its instructions to reflect changes made by recent legislation. The IRS made line changes to account for the COBRA (Consolidated Omnibus Budget Reconciliation Act) premium assistance credit, created by the American Rescue Plan Act of 2021 (ARPA), which is only available for periods of coverage from April 1 through September 30, 2021. The COBRA premium assistance credit can only be claimed on employment tax returns for the second, third, or fourth quarters of 2021, depending on when the employer becomes entitled to the credit. The last day to file Form 7200 to request an advance payment: for the second quarter is August 2 for the third quarter is November 1 and for the fourth quarter is January 31, 2022. Changes to Form 7200 Here are the line changes to Form 7200: Part I, Line B is now where an employer should enter the total number of employees it paid qualified wages eligible for the employee retention credit this quarter. Previously, the line was a checkbox for employers to indicate if the business was started on or after January 1, 2020. Part I, Line G is a new line for an employer to enter the number of individuals provided COBRA premium assistance during the quarter for the advance requested. Part I, Line H is a new checkbox if the employer is eligible for the employee retention credit solely because the business is a recovery startup business. Part II, Line 4 is to enter the total COBRA premium assistance provided during the quarter. Part II, Lines 5-8 shift down to account for Line 4. The advance requested is now entered on new Line 9. Overall credit periods The credit for voluntarily providing qualified paid sick and family leave wages, which was extended by the Consolidated Appropriations Act, 2021 (CAA), is available for leave taken before October 1, 2021. The ARPA also amended the credit. The employee retention credit (ERC), which was amended and extended by both the CAA and the ARPA, is available for wages paid before January 1, 2022. The COBRA premium assistance credit, created by the ARPA, is only available for periods of coverage from April 1 through September 30, 2021. The COBRA premium assistance credit can only be claimed on employment tax returns for the second, third, or fourth quarters of 2021, depending on when the employer becomes entitled to the credit. Eligible employers may request an advance of the tax credit by filing Form 7200.
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