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Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

 
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Best answer January 19, 2020

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QuickBooks Team

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

I've got you covered, kjamroz.

 

You can manually adjust the liability so QuickBooks will show the correct wage amount on the 940 form. To do so, please follow the steps below:

  1. Go to the Employees menu.
  2. Select Payroll Taxes and Liabilities, then Adjust Payroll Liabilities.
  3. Make sure to select 2019 for the date.
  4. Choose Employee, then select a name from the drop-down list.
  5. Enter the federal unemployment item in the Item Name field.
  6. Enter a negative amount ($ 34995) in the Wage Base field.
  7. Click OK.

I've added this article, Payroll Liability and/or Balance Sheet Report shows incorrect amounts for payroll liabilities for more details with the steps above. It includes common reasons why incorrect amounts appear on your report and how to fix them.

 

Feel free to leave a comment below if there's anything else you need concerning payroll. I'm always around to help you out.

View solution in original post

14 Comments
Highlighted
Moderator

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Hello dear, kjamroz.

 

Let's check why is this happening by following the steps below and get the information, you can use it on how to resolve the issue.

  1. From the Reports menu, under Employees & Payroll, select More Payroll Reports in Excel.
  2. Click Tax Form Worksheets and select the specific Annual 940 form, and specify dates for the report to be run.
  3. Select Create Report.
  4. Review the tax form worksheet for the 940 in Excel and note.

 

You can continue following the detailed instruction on how you can do  in this article: Troubleshooting Form 940 with exempt FUTA wages.

 

The Community is always here for you. Post again if you have other questions!. Take care!

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

I ran the report, the wages for one of my employees states $55320.00 when his actual wages are $20325.00. The wages show correctly under heading SUI by State & Employee on the same report.

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Is there a support phone number that I can call? I just need to find out how to add correct dollar amounts to form 940. QuickBooks doesn't allow me to just change the numbers and I need to get this form filed.

Highlighted
QuickBooks Team

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Hi there, kjamroz.

 

We'll need to get the correct wage base of the affected employee to get the discrepancy amount. Then, use it to adjust the unemployment insurance of the employee. This can be done by running the Payroll Checkup and then making a liability adjustment (employee). 

 

Please be sure to back up your company file before making any changes to your transactions.

 

If you have questions along the process, please don't hesitate to reach back out.

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

After reviewing further, I see that on the transactions by payroll item report for Federal Unemployment, starting June 9th, each of the employee's payroll is recorded 4 times. This makes it look like he was paid $34995.00 more than it should. How do I take the additional 3 payroll amounts out for each pay period?

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Thank you JessT.  Is my liability adjustment -34995.00 (the difference of the "income subject to tax" on my payroll item report for FUTA)? Or do I add the actual payroll amount for the year under "income subject to tax"?

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Correct wages for 2019 were $20325.00

Highlighted
QuickBooks Team

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

I've got you covered, kjamroz.

 

You can manually adjust the liability so QuickBooks will show the correct wage amount on the 940 form. To do so, please follow the steps below:

  1. Go to the Employees menu.
  2. Select Payroll Taxes and Liabilities, then Adjust Payroll Liabilities.
  3. Make sure to select 2019 for the date.
  4. Choose Employee, then select a name from the drop-down list.
  5. Enter the federal unemployment item in the Item Name field.
  6. Enter a negative amount ($ 34995) in the Wage Base field.
  7. Click OK.

I've added this article, Payroll Liability and/or Balance Sheet Report shows incorrect amounts for payroll liabilities for more details with the steps above. It includes common reasons why incorrect amounts appear on your report and how to fix them.

 

Feel free to leave a comment below if there's anything else you need concerning payroll. I'm always around to help you out.

View solution in original post

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Thank you so much! My 940 Summary shows correct income for this employee, but instead of the taxed wagebase being $7000.00 it is -$17470.00 and excess wages are $37795.00, which should be $13325.00.

 

 

Highlighted
QuickBooks Team

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Thanks for getting back to us and providing an update, @kjamroz.


It’s possible that a liability adjustment was created causing the amount to go up to -$17470.00. Let’s find the difference between that amount and the $7000.00 taxed wage base to fix your 940 data.


Here’s how:

  1. From the Employee Center, tap the Transactions tab.
  2. Click Liability Adjustments.
  3. From there, look for an adjustment that would total to -$10470.00.
  4. Open and press Ctrl + D on your keyboard, then hit OK to delete the transaction.

FUTA 1.PNG FUTA 2.PNG

 

For more information on how this type of transaction works, I recommend checking out this article: Adjust payroll liabilities in QuickBooks Desktop.


Please let me know how it goes on your end and if you need further assistance. I'm here to keep helping. Have a good one!

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

The only transaction in Employee Liabilities, is the one I created for -34995.00. 

I guess I need to figure out why this happened in the first place but in the meantime would like to get this corrected so I can file my end of year 940. 

Can I add additional liabilities to make these corrections? 

 

Highlighted
QuickBooks Team

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Hi there, @kjamroz.

 

You'll want to get in touch with your accountant for guidance how to better record this. That way, you'll be guided accordingly and avoid any future error.

 

In case you need to learn some tips and best practices on managing your QuickBooks Desktop (QBDT), you can visit our Help articles page for reference.

 

As always, don't hesitate to get back to us if you have other questions or concerns. We'll be around to help you.

Highlighted
Level 2

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

Unfortunately, my accountant is not as knowledgeable in QB. I need a phone number to contact QB directly. This is ridiculous that this happened and I cannot find a phone number to contact QB directly. They have monopolized this market. I have just purchased an existing business and was going to purchase an additional QB for my new company of over 100 employees, unfortunately, I have to find another way since it's so difficult to speak with someone. I guess I'm old school but for me speaking to someone is so much easier when trying to explain the issue. So sad, been using QB since it's inception, also use for my personal financial records. 

Highlighted
QuickBooks Team

Form 940 shows exempt negative amt. of The tax form worksheet report for 940 one of my employees yearly wage was incorrect, I corrected. How do I correct the form 940?

I appreciate all your efforts in performing the recommended solutions provided by my colleague, kjamroz.

 

I can help you reaching out to our phone supports. Since all information displayed here in the Community is public, we're unable to share any specific information of the supports for security reasons. You can follow the steps below to connect with us:

  1. Log into your company file.
  2. Select Help from the top menu bar.
  3. Click Contact Us.
  4. Enter "940 shows exempt negative amounts" in the description.
  5. Hit Continue.
  6. Select the best support options for you.

You can check out our support hours and contact us at a time convenient to you.

 

Feel comfortable to shoot comments below if you any other concerns or questions about 940 forms. I'll be right here to keep helping.

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