Special Supplement: COVID-19 - Questions & Answers SPECIAL SUPPLEMENT: COVID-19 APA's Top Payroll Questions & Answers for 2020 Third-party providers Q. If we have a third-party payroll provider filing for us, and they are not going to make the payment for the deferral of the social security tax, do we know how the IRS is going to handle the ERC doing it on their own? A. Employers that pay qualified sick or family leave, or wages qualifying for the employee retention credit, are entitled to the credit regardless of whether they use a third-party payer to report and pay their federal employment taxes. The third-party payer is not entitled to credits for wages it remits on an employer's behalf (regardless of whether the third party is considered an "employer" for other purposes). Section 3504 agent and certified professional employer organization (CPEO) clients are entitled to request the advance payment of the credits on Form 7200 even though their employment tax return information is included on the aggregate employment tax return filed by the third party. The employer must provide copies of the Forms 7200 to the ยง3504 agent or CPEO so the credits may be reconciled on the aggregate employment tax return. Similarly, clients of non-certified PEOs that are entitled to do so may request the advance payment of the credits on Form 7200 even though their employment tax return information is included on the aggregate employment tax return filed by the PEO. The employer will need to provide its PEO copies of the Forms 7200 so the credits can be reconciled on the aggregate employment tax return using Form 941, Schedule R. 114