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Department of the Treasury
Internal Revenue Service
Instructions for Schedule R
(Form 943)
(Rev. December 2023)
Allocation Schedule for Aggregate Form 943 Filers
Section references are to the Internal Revenue Code organization (CPEO); (d) a client who enters into a service
unless otherwise noted. agreement described under Regulations section
31.3504-2(b)(2) with a non-certified professional employer
Future Developments organization (PEO); or (e) a third party paying qualified
sick leave wages as an agent for the employer under
For the latest information about developments related to Regulations section 32.1(e)(3). If you have more than five
Schedule R and its instructions, such as legislation clients, complete as many Continuation Sheets as
enacted after they were published, go to IRS.gov/ necessary. Attach Schedule R, including any Continuation
Form943. Sheets, to your aggregate Form 943.
Who Must File?
What’s New
Agents approved by the IRS under section 3504 and
These instructions were updated for changes made to the CPEOs must complete Schedule R each time they file an
2023 revision of the Form 943. The lines related to the aggregate Form 943. To request approval to act as an
COBRA premium assistance credit on Form 943 have agent for an employer under section 3504, the agent must
been “Reserved for future use” because the first quarter of file Form 2678 with the IRS. Form 2678 must be previously
2022 was the last quarter in which most employers may filed and approved by the IRS before filing Schedule R. To
have been eligible to claim the COBRA premium become a CPEO, the organization must apply through the
assistance credit. The Schedule R columns for reporting IRS Online Registration System. Go to the IRS website at
amounts related to the COBRA premium assistance credit IRS.gov/CPEO for more information. Other third-party
from Form 943 have been repurposed. Columns l, r, t, and payers that file aggregate Forms 943, such as
x, which were “Reserved for future use” on the 2022 non-certified PEOs, must complete and file Schedule R if
revision of Schedule R, have also been repurposed. Don't they have clients that are claiming the qualified small
file an earlier revision of Schedule R with Form 943 for any business payroll tax credit for increasing research
year beginning after 2022. activities or the credit for qualified sick and family leave
wages. Third-party payers other than agents approved by
Under some rare circumstances, it may be possible for a the IRS under section 3504 and CPEOs need to include
premium payee to become entitled to the COBRA client-by-client amounts only for those clients claiming one
premium assistance credit after the first quarter of 2022. or more of these credits. Amounts for clients not claiming
However, in those cases, the credit must be claimed on a any of these credits are included on Schedule R, page 1,
Form 943-X, Adjusted Employer's Annual Federal Tax line 8.
Return for Agricultural Employees or Claim for Refund. We
have repurposed column y on the Schedule R to report Generally, the common-law employer of the individuals
the lines related to the COBRA premium assistance credit that are paid qualified sick or family leave wages is entitled
on Form 943-X. We have added a checkbox at the top of to the credit for qualified sick and family leave wages,
the Schedule R to tell us which form your Schedule R is regardless of whether they use a third-party payer. The
attached to. For more information, see the Instructions for third-party payer isn't entitled to the credits with respect to
Form 943 and the Instructions for Form 943-X. If you're the wages and taxes it remits on behalf of clients
filing Form 943-X to claim the COBRA premium (regardless of whether the third party is considered an
assistance credit on behalf of any clients, you must file the "employer" for other purposes).
2023 revision of Schedule R with Form 943-X.
When Must You File?
If you’re an aggregate Form 943 filer, file Schedule R with
General Instructions your aggregate Form 943 every year. Agents and
non-certified PEOs may file Form 943 and Schedule R
Purpose of Schedule R electronically or by paper submission. CPEOs must
Use Schedule R to allocate certain aggregate information generally file Form 943 and Schedule R electronically. For
reported on Form 943 to each client. For purposes of more information about a CPEO's requirement to file
Schedule R, the term “client” means (a) an “employer or electronically, see Rev. Proc. 2023-18, 2023-13 I.R.B 605,
payer” identified on the Form 2678, Employer/Payer available at IRS.gov/irb/2023-13_IRB#REV-
Appointment of Agent; (b) a customer who enters into a PROC-2023-18.
contract that meets the requirements under section
7705(e)(2); (c) a client who enters into a service
agreement described under Regulations section
31.3504-2(b)(2) with a certified professional employer
Oct 18, 2023 Cat. No. 74489F
