Instructions For Form 943 - 2017


Department of the Treasury
Internal Revenue Service
Instructions for Form 943
Employer's Annual Federal Tax Return for Agricultural Employees
Section references are to the Internal Revenue Code
Qualified small business payroll tax credit for in-
unless otherwise noted.
creasing research activities. For tax years beginning
after December 31, 2015, a qualified small business may
Future Developments
elect to claim up to $250,000 of its credit for increasing
For the latest information about developments related to
research activities as a payroll tax credit against the
Form 943 and its instructions, such as legislation enacted
employer's share of social security tax. The portion of the
after they were published, go to
credit used against the employer's share of social security
tax is allowed in the first calendar quarter beginning after
What's New
the date that the qualified small business filed its income
tax return. The first Form 943 that you can claim this credit
New filing addresses. The filing addresses for
on is Form 943 filed for calendar year 2017. The election
employers located in Georgia, Illinois, Kentucky,
and determination of the credit amount that will be used
Michigan, Tennessee, and Wisconsin have changed. See
against the employer's share of social security tax are
Where To
File, later.
made on Form 6765, Credit for Increasing Research
Social security and Medicare tax for 2017. The social
Activities. The amount from Form 6765, line 44, must then
security tax rate is 6.2% each for the employee and
be reported on Form 8974, Qualified Small Business
employer, unchanged from 2016. The social security
Payroll Tax Credit for Increasing Research Activities.
wage base limit is $127,200.
Form 8974 is used to determine the amount of the credit
The Medicare tax rate is 1.45% each for the employee
that can be used in the current year. The amount from
and employer, unchanged from 2016. There is no wage
Form 8974, line 12, is reported on Form 943, line 12. If
base limit for Medicare tax.
you're claiming the research payroll tax credit on your
Form 943, you must attach Form 8974 to Form 943. For
New certification program for professional employer
more information about the payroll tax credit, see Notice
organizations. The Tax Increase Prevention Act of 2014
2017-23, 2017-16 I.R.B. 1100, available at
required the IRS to establish a voluntary certification
2017-16_IRB/ar07.html. Also see
Adjusting tax liability for
program for professional employer organizations (PEOs).
the qualified small business payroll tax credit for
PEOs handle various payroll administration and tax
increasing research activities reported on line
12, later.
reporting responsibilities for their business clients and are
typically paid a fee based on payroll costs. To become
The payroll tax credit must generally be elected on an
and remain certified under the certification program,
original income tax return that is timely filed (including
certified professional employer organizations (CPEOs)
extensions). However, Notice 2017-23 provides a limited
must meet various requirements described in sections
exception to that rule, allowing a qualified small business
3511 and 7705 and related published guidance.
that timely files its income tax return for a tax year
Certification as a CPEO may affect the employment tax
beginning after December 31, 2015, but fails to make the
liabilities of both the CPEO and its customers. A CPEO is
payroll tax credit election, to make the election on an
generally treated as the employer of any individual who
amended income tax return filed on or before December
performs services for a customer of the CPEO and is
31, 2017. The Form 6765 filed with that amended income
covered by a contract described in section 7705(e)(2)
tax return must meet certain procedural requirements
between the CPEO and the customer (CPEO contract),
provided in section 4.02 of Notice 2017-23. If the payroll
but only for wages and other compensation paid to the
tax credit is elected on an amended income tax return
individual by the CPEO. For more information, go to
filed under Notice 2017-23, the payroll tax credit is Also see Rev. Proc. 2017-14, 2017-3
allowed against the employer share of social security tax
I.R.B. 426, available at
for the quarter that begins after the amended income tax
return is filed. The payroll tax credit can't be applied to an
earlier quarter.
New Schedule R (Form 943), Allocation Schedule for
Aggregate Form 943 Filers. Agents approved by the
IRS under section 3504 and CPEOs must now complete
Work opportunity tax credit for qualified tax-exempt
and file the new Schedule R (Form 943) each time they
organizations hiring qualified veterans. The work
file an aggregate Form 943. To request approval to act as
opportunity tax credit is available for eligible unemployed
an agent for an employer under section 3504, the agent
veterans who begin work on or after November 22, 2011,
must file Form 2678 with the IRS. Form 2678 must be
and before January 1, 2020. Qualified tax-exempt
previously filed and approved by the IRS before filing
organizations that hire eligible unemployed veterans can
Schedule R. To become a CPEO, the organization must
claim the work opportunity tax credit against their payroll
apply through the IRS Online Registration System at
Oct 10, 2017
Cat. No. 25976L


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