941-X: 15. Tax Adjustments, Form Instructions (2024 updates)

The “Tax Adjustments” section is listed as question #15 under Part 3 of Form 941-X, which is needed to claim the employee retention tax credit. Instructions are below for the  Tax Adjustments section.

Key 941-X Tax Form Takeaways:

  • Correcting Reported Adjustments: Utilize Form 941-X to correct discrepancies on previously reported adjustments, particularly related to sick pay and third-party sick pay adjustments. Ensure accurate entries on line 15 to reflect changes to tax obligations.
  • Detailed Reporting for Corrections: When adjusting figures in Form 941-X, detail the original and corrected amounts and explain the reasons for corrections on line 43. This helps clarify any discrepancies in tax filings.
  • Importance of Accuracy: Ensure all adjustments and entries on Form 941-X are accurate to prevent potential issues with the IRS. Errors in tax forms can lead to further complications and possible audits.

See Important 2024 Employee Retention Tax Credit Deadline Information at the Bottom of This Article.

Form 941-X:

15. Tax Adjustments

Part 3: Enter the corrections for this quarter. If any line doesn’t apply, leave it blank.

15. Tax adjustments (Form 941 or 941-SS, lines 7 through 9) 

Adjusted Employer’s QUARTERLY Federal Tax Return or Claim for Refund

Part 3, “15. Tax Adjustments“ from Form 941X published by the Department of the Treasury – Internal Revenue Service (IRS), OMB No. 1545-0029, revised in April 2022.

Instructions for Form 941-X:

15. Tax Adjustments

TIP: For purposes of these instructions, all references to “sick pay” mean ordinary sick pay, not “qualified sick leave wages.”

Use line 15 to correct any adjustments reported on Form 941, lines 7–9. Enter in column 1 the total corrected amount for Form 941, lines 7–9.

Enter in column 2 the total originally reported or previously corrected amounts from Form 941, lines 7–9. In column 3, enter the difference between columns 1 and 2.

941x 15 image1

TIP: You may need to report negative numbers in any column. Make sure that the difference you enter in column 3 accurately represents the change to adjustments originally reported or previously corrected on Form 941, lines 7–9.

Copy the amount in column 3 to column 4. Include any minus sign shown in column 3.

 On line 43, describe what you misreported on Form 941. Tell us if your adjustment is for fractions of cents, third-party sick pay, tips, or group-term life insurance.

Example – Current quarter’s third-party sick pay underreported. You reported $6,900 (shown as “-6,900.00”) as a third-party sick pay adjustment (reduction to tax) on line 8 of your 2021 second quarter Form 941. You didn’t report any amounts on lines 7 and 9. Your third-party sick pay adjustment should’ve been $9,600 (shown as “-9,600.00”) because your third-party sick pay payer withheld that amount of social security and Medicare taxes from your employees. You discovered the error in April of 2022. To correct the error, figure the difference on Form 941-X as shown. 

941x 15 image2

Here is how you would enter the numbers on Form 941-X.

941x 15 image3

Report “-2,700.00” as your correction in column 4. In this example, you’re claiming a credit for $2,700 in overreported tax for your 2021 second quarter Form 941. Always enter the same amount in column 4 (including any minus sign) that you enter in column 3. 

Be sure to explain the reasons for this correction on line 43. 

Adjusted Employer’s QUARTERLY Federal Tax Return or Claim for Refund

Instructions for Part 3, “15. Tax Adjustments“ came from the IRS Instructions for Form 941-X published by the Internal Revenue Service (IRS) Department of the Treasury, revised in April 2022.

Conclusion and Summary on 941-X: 15. Tax Adjustments, Form Instructions

The “Tax Adjustments” section is just one of forty three detailed questions and calculations you must complete correctly on the 941X IRS Form. Listed as question #15 under Part 3 of the 941X, be sure to answer the Tax Adjustments question #15 correctly.

How To Fill Out Form 941-X For the Employee Retention Tax Credit?

Watch this 941-X video to learn more about how to fill out the IRS 941-X Form properly.

Need Help Completing / Filing IRS Form 941-X?

Disaster Loan Advisors can assist your business in filing an amended Form 941 Employer’s Quarterly Federal Tax Return (for 2020 and 2021), which is IRS Form 941-X Adjusted Employer’s Quarterly Federal Tax Return or Claim for Refund.

This tax form is required to be filled out correctly and filed for each qualifying quarter in 2020 and 2021 to ensure your business claims the maximum Employee Retention Credit (ERC) / Employee Retention Tax Credit (ERTC).

– Did you calculate your company’s maximum ERC Tax Credit correctly?
– Are you claiming all the ERC Credit for each qualifying quarter?
– Are you maximizing the total amount of ERC Credit your company qualifies for?
– Need a professional set of eyes to ensure you filled out your form 941X correctly?

Flexible and Professional ERC Consulting Tax Services

There are several flexible options for you. We can review, prepare, and / or file your 941-X Forms for you, or with you.

– Do-It-Yourself (DIY) and have us review your work.
– Done-With-You (DWY) and let’s collaborate together.
– Done-For-You (DFY) and we handle it all for you, from start to finish.
– Or, Consult-With-You to customize to your exact needs. 

Our professional ERC fee and pricing structure is very reasonable in comparison.

We DO NOT charge a percentage (%) of your ERC Refund like some companies are charging. Some ERC firms out there are charging upwards of 25% to 35% of your ERC refund! 

If you are looking for an ERC Company that believes in providing professional ERC Tax Services and value for small business owners, in exchange for a fair, reasonable, and ethical flat-fee for the amount of work required, Disaster Loan Advisors is a good fit for you. 

Form 941-X and the ERC program can be very confusing as it relates to your specific business situation. Our fee structure is fair and reasonable for the same or better level of ERC service.

Schedule Your Form 941-X Consultation to have peace of mind you are making sure your company actually qualifies, AND you are calculating the employee retention tax credit properly.

Deadlines to File IRS Form 941-X in 2024 and 2025

The 2020 ERC Credit Tax Year deadline of 4/15/24 has already passed. Good news? The opportunity to retroactively claim your business Employee Retention Credit for the prior 2021 Tax Year is still available, with a next year April 15, 2025 deadline.

This really is your FINAL chance at any potential ERC tax credit refund!

How to Claim the Employee Retention Tax Credit (ERC / ERTC) and Receive Up to a $26,000 Refund Per Employee

Disaster Loan Advisors can assist your business with the complex and confusing Employee Retention Credit (ERC) and Employee Retention Tax Credit (ERTC) program. 

Depending on eligibility, business owners and companies can receive up to $26,000 per employee based on the number of W2 employees you had on the payroll in 2020 and 2021.

The ERC / ERTC Program is a valuable tax credit you can claim. This is money you have already paid to the IRS in payroll taxes for your W2 employees.

Schedule Your Free Employee Retention Credit Consultation to see if your company qualifies for the employee retention tax credit.

Cover Image Credit: Irs.gov / Form 941-X / Disaster Loan Advisors.

Mark Monroe

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