How to determine the refundable and nonrefundable amounts of credits using 941 Worksheets?
228 views | Last modified 4/25/2023 4:38:24 AM EST | Added by TaxBandits Team

To determine the refundable and nonrefundable portions of qualified family and sick leave as well as employee retention credits, employers can use the 941 Worksheets created by the IRS. These worksheets are designed to simplify the calculation process and help employers determine the correct amount of credits that they are entitled to.

There are a total of five worksheets, each with its own specific purpose. 

• Worksheet 1 is for Credit for Qualified Sick and Family Leave Wages Paid This Quarter of 2023 for Leave Taken After March 31, 2020, and Before April 1, 2021.
• Worksheet 2 is for Credit for Qualified Sick and Family Leave Wages Paid This Quarter of 2023 for Leave Taken After March 31, 2021, and Before October 1, 2021
• Worksheet 3 is used to calculate the nonrefundable and refundable portions of credits for sick and family wages taken after April 1, 2021. 
• Worksheet 4 is used to calculate the employee retention credit for the third and fourth quarters of 2021 (Qualified Wages Paid After June 30, 2021). 
• Worksheet 5 is used to calculate the nonrefundable and refundable portions of the COBRA premium assistance credit.

Employers must fill out the appropriate worksheet(s) accurately and submit them along with Form 941 when filing their tax returns. By using these worksheets, employers can ensure that they are correctly calculating the refundable and nonrefundable portions of the qualified family and sick leave and employee retention credits they are eligible for, which can help them reduce their tax liabilities and receive any refunds owed to them in a timely manner.