This publication reflects changes included in the recently enacted American Recovery and Reinvestment Act of 2009 (ARRA).

New tables for wage withholding and advance earned income credit (EIC) payments. New tables for wage withholding and advance earned income credit (EIC) payments have been developed due to changes made to the tax law by ARRA. How To Use the Income Tax Withholding and Advance Earned Income Credit (EIC) Payment Tables and the associated tables have been removed from this revision of the publication and can now be found on pages 3–35 in Publication 15-T, New Wage Withholding and Advance Earned Income Credit Payment Tables (For Wages Paid Through December 2009).The tables for wage withholding and advance earned income credit payments published in Publication 51 (Circular A), Agricultural Employer's Tax Guide, and the tables for alternative methods for figuring withholding published in Publication 15-A, Employer's Supplemental Tax Guide, are also replaced with the tables published in Publication 15-T. The new withholding tables in Publication 15-T also apply for figuring income tax withholding on pension payments.Employers should begin using these tables as soon as possible after February 17, 2009, but no later than April 1, 2009.

Withholding income taxes on the wages of nonresident alien employees. Due to changes enacted by ARRA, new higher amounts in the chart titled Amount to Add to Nonresident Alien Employee's Wages for Calculating Income Tax Withholding Only on page 16 in section 9 must be used with the new withholding tables to figure income tax withholding on the wages of nonresident alien employees.

COBRA premium assistance credit. ARRA allows a credit against employment taxes for providing COBRA premium assistance for certain involuntarily terminated employees once the employees' reduced share of the premiums has been paid. See COBRA premium assistance credit in the Introduction.

Social security and Medicare tax for 2009. Do not withhold social security tax after an employee reaches $106,800 in social security wages. There is no limit on the amount of wages subject to Medicare tax. Social security and Medicare taxes apply to the wages of household workers you pay $1,700 or more in cash. Social security and Medicare taxes apply to election workers who are paid $1,500 or more.

Disregarded entities and qualified subchapter S subsidiaries (QSubs). The IRS has published final regulations (Treasury Decision 9356) under which QSubs and eligible single-owner disregarded entities are treated as separate entities for employment tax purposes. For more information, see Disregarded entities and qualified subchapter S subsidiaries in the Introduction.

New employment tax adjustment and claim process in 2009. If you discover an error on a previously filed Form 941 or Form 944 after December 31, 2008, make the correction using new Form 941-X, Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund, or Form 944-X, Adjusted Employer's ANNUAL Federal Tax Return or Claim for Refund. For errors discovered before January 1, 2009, taxpayers make corrections to Forms 941 and 944 using Form 941c, Supporting Statement To Correct Information, that is filed with Form 941 or Form 944 or by requesting a claim for refund or abatement on Form 843, Claim for Refund and Request for Abatement. Forms 941-X and 944-X are stand-alone forms, meaning taxpayers can file them when an error is discovered, rather than wait until the end of the quarter or year to file Form 941c with Form 941 or 944. Lines 7d, 7e, 7f, and 7g have been deleted from Form 941 beginning with the first quarter of 2009 and lines 6b, 6c, 6d, and 6e will be deleted from Form 944 for 2009. Adjustments previously made on those lines are now made on the new Forms 941-X and 944-X. Claims for refund or abatement previously made on Form 843 are now made on Forms 941-X and 944-X. For more information, visit the IRS website at www.irs.gov and enter the keywords Correcting Employment Taxes.

Credit card payments. You can pay the balance due on Form 943, Employer's Annual Federal Tax Return for Agricultural Employees, and Form 945, Annual Return of Withheld Federal Income Tax, by credit card. Do not use a credit card to make federal tax deposits. For more information on paying your taxes with a credit card, visit the IRS website at www.irs.gov and click on the electronic IRS link.

Social Security Administration and magnetic media. Employers and authorized reporting agents requesting verification of names and social security numbers of between 51 and 250,000 employees can no longer use magnetic media to submit their requests to the Social Security Administration. Employers can upload a file through the Social Security Number Verification System (SSNVS) and will usually receive the results the next government business day. For more information, see Verification of social security numbers in section 4.

Paid preparers must sign Form 941 and Form 944. The paid preparer's section is no longer optional and is included in Part 5 of Form 941 and Form 944.

Differential wage payments. Differential wage payments will be treated as wages, subject to income tax withholding, but not social security, Medicare, or FUTA taxes, beginning with wages paid after December 31, 2008. See Differential wage payments in section 5 for more information.

Certain foreign persons treated as American employers. For services performed after July 31, 2008, certain foreign persons are treated as American employers for paying FICA taxes on employees' wages. For more information, see Foreign persons treated as American employers under Social Security and Medicare Taxes in section 9.