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OMB No. 1545-2126
Form 8932 Credit for Employer Differential Wage Payments
(Rev. December 2019) ▶ Attach to your tax return. Attachment
Department of the Treasury
Internal Revenue Service ▶ Go to www.irs.gov/Form8932 for the latest information. Sequence No. 161
Name(s) shown on return Identifying number

1 Eligible differential wage payments paid during the tax year (see instructions) . . . . . . . 1
2 Multiply line 1 by 20% (0.20). See instructions for the adjustment you must make to your
deduction for salaries and wages . . . . . . . . . . . . . . . . . . . . . . 2
3 Credit for employer differential wage payments from partnerships, S corporations, cooperatives,
estates, and trusts (see instructions) . . . . . . . . . . . . . . . . . . . . . 3
4 Add lines 2 and 3. Cooperatives, estates, and trusts, go to line 5. Partnerships and S corporations,
stop here and report this amount on Schedule K. All others, stop here and report this amount on
Form 3800, Part III, line 1w . . . . . . . . . . . . . . . . . . . . . . . . 4
5 Amount allocated to patrons of the cooperative or beneficiaries of the estate or trust (see
instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
6 Cooperatives, estates, and trusts, subtract line 5 from line 4. Report this amount on Form 3800,
Part III, line 1w . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

General Instructions Definitions
Section references are to the Internal Revenue Code Eligible Differential Wage Payments
unless otherwise noted. Eligible differential wage payments are the total
Future Developments differential wage payments paid to the employee for the
tax year, up to $20,000.
For the latest information about developments related to
Form 8932 and its instructions, such as legislation Qualified Employee
enacted after they were published, go to A qualified employee is a person who has been an
www.irs.gov/Form8932. employee for the 91-day period immediately preceding
the period for which any differential wage payment is
Which Revision To Use made.
Use this December 2019 revision of Form 8932 for tax Differential Wage Payment
years beginning in 2019 or later, until a later revision is
issued. Use prior revisions of this form for earlier tax To be considered a differential wage payment, the
years. All revisions are available at www.irs.gov/ payment must meet both of the following requirements.
Form8932. • The payment is made to a qualified employee for any
period during which the employee is performing service in
Purpose of Form the uniformed services of the United States while on
Use Form 8932 to claim the credit for eligible differential active duty for a period of more than 30 days.
wage payments made to qualified employees after 2008. • The payment represents all or a portion of the wages
The credit is 20% of up to $20,000 of differential wage the employee would have received from the employer if
payments paid to each qualified employee during the tax the employee were performing services for the employer.
year.
Controlled Groups
The credit for employer differential wage payments is
part of the general business credit. All persons treated as a single employer under
subsection (b), (c), (m), or (o) of section 414 are treated as
Partnerships, S corporations, cooperatives, estates,
a single employer.
and trusts must file this form to claim the credit. All other
taxpayers are not required to complete or file this form if Uniformed Services
their only source for this credit is a partnership, Uniformed services means the Armed Forces; the Army
S corporation, cooperative, estate, or trust. Instead, they National Guard and the Air National Guard when engaged
can report this credit directly on Form 3800, General in active duty for training, inactive duty training, or full-
Business Credit. time National Guard duty; the commissioned corps of the
For details, see section 45P and Notice 2010-15, Public Health Service; and any other category of persons
2010-6 I.R.B. 390, available at designated by the President in time of war or national
www.irs.gov/irb/2010-06_IRB#NOT-2010-15. emergency.
Coordination With Other Credits
The amount of any research credit or orphan drug credit
otherwise allowable for compensation paid to any
employee is reduced by the credit for differential wage
payments figured for that employee.

For Paperwork Reduction Act Notice, see instructions. Cat. No. 37747W Form 8932 (Rev. 12-2019)

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Form 8932 (Rev. 12-2019) Page 2

Disallowance for Failure To Comply With If the cooperative is subject to the passive activity
Employment or Reemployment Rights of rules, include on line 3 any Form 8932 credit from passive
activities disallowed for prior years and carried forward to
Members of the Reserve Components of the this year. Complete Form 8810, Corporate Passive
Armed Forces of the United States Activity Loss and Credit Limitations, to determine the
No credit will be allowed to a taxpayer for: allowed credit that must be allocated to patrons. For
details, see the Instructions for Form 8810.
• Any tax year in which the taxpayer is under a final order,
judgment, or other process issued or required by a Estates and trusts. Allocate the credit for employer
district court of the United States under section 4323 of differential wage payments on line 4 between the estate
title 38 of the United States Code with respect to a or trust and the beneficiaries in the same proportion as
violation of chapter 43 of title 38; and income was allocated and enter the beneficiaries’ share
online 5.
• The 2 succeeding tax years.
If the estate or trust is subject to the passive activity
rules, include on line 3 any Form 8932 credit from passive
Specific Instructions activities disallowed for prior years and carried forward to
Line 1 this year. Complete Form 8582-CR, Passive Activity
Credit Limitations, to determine the allowed credit that
Enter the total amount of eligible differential wage must be allocated between the estate or trust and the
payments made to qualified employees during the tax beneficiaries. For details, see the Instructions for Form
year. Do not include more than $20,000 of payments for 8582-CR.
any employee.
Line 2 Paperwork Reduction Act Notice. We ask for the
Generally, you must reduce your deduction for salaries information on this form to carry out the InternalRevenue
and wages by the amount on line 2, even if you cannot laws of the United States. You are required togive us the
take the full credit this year because of the tax liability information. We need it to ensure that you are complying
limit. If you capitalized any costs on which you figured the with these laws and to allow us to figureand collect the
credit, reduce the amount capitalized by the credit right amount of tax.
attributable to these costs. You are not required to provide the information
Line 3 requested on a form that is subject to the Paperwork
Reduction Act unless the form displays a valid OMB
Enter total credits for employer differential wage control number. Books or records relating to a form or its
payments from: instructions must be retained as long as their contents
• Schedule K-1 (Form 1065), Partner’s Share of Income, may become material in the administration of any Internal
Deductions, Credits, etc., box 15 (code P); Revenue law. Generally, tax returns and return
information are confidential, as required by section 6103.
• Schedule K-1 (Form 1120-S), Shareholder’s Share of
Income, Deductions, Credits, etc., box 13 (code P); The time needed to complete and file this form will vary
depending on individual circumstances. The estimated
• Schedule K-1 (Form 1041), Beneficiary’s Share of
burden for individual and business taxpayers filing this
Income, Deductions, Credits, etc., box 13 (code Q); or
form is approved under OMB control number 1545-0074
• Form 1099-PATR, Taxable Distributions Received From and 1545-0123 and is included in the estimates shown in
Cooperatives, box 12 (box 11 for 2019), or other notice of the instructions for their individual and business income
credit allocation. tax return. The estimated burden for all other taxpayers
Partnerships, S corporations, cooperatives, estates, who file this form is shown below.
and trusts report the above credits on line 3. All other Recordkeeping . . . . . . . . . . 1 hr., 54 min.
filers figuring a separate credit on earlier lines also report
Learning about the
the above credits on line 3. All others not using earlier
law or the form . . . . . . . . . . . . 30 min.
lines to figure a separate credit can report the above
credits directly on Form 3800, Part III, line 1w. Preparing and sending the form
to the IRS . . . . . . . . . . . . . . 33 min.
Line 5
If you have comments concerning the accuracy of
Cooperatives. A cooperative described in section these time estimates or suggestions for making this form
1381(a) must allocate to its patrons the credit in excess simpler, we would be happy to hear from you. See the
of its tax liability limit. Therefore, to figure the unused instructions for the tax return with which this form is filed.
amount of the credit allocated to patrons, the
cooperative must first figure its tax liability. While any
excess is allocated to patrons, any credit recapture
applies as if the cooperative had claimed the credit.

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