Pursuant to the American Recovery and Reinvestment Act of 2009 or ARRA, certain involuntarily terminated employees are eligible for employer-provided subsidies to help pay for their Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation coverage. Employers may then claim a payroll tax credit on their Form 941, Employer’s QUARTERLY Federal Tax Return, to be reimbursed for the assistance provided.
As the end of the second quarter nears, employers who are expecting to apply for a refund on their Form 941 should ensure that all amounts eligible for the credit have been reported to Vision Payroll so that we may reflect those amounts on the Form 941. Amounts reported after the Form 941 has been filed will need to be corrected through the use of Form 941-X, Adjusted Employer’s QUARTERLY Federal Tax Return or Claim for Refund. Employers should also ensure that all required documentation is maintained.
Contact Vision Payroll if you have any question on the premium reduction credit.