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Rosyinoregon
Level 1

Form 940 with care act qualified wages ( care act employer retention credit)

The qualified wages show as negative amount in line 4! What is wrong for that, i followed the instruction to set up accounts.

 

total wages 90000, incl 30000 qualified wages, in form 940, line 3 is 60000 and line 4 is -30000,

please help.

thanks!

7 Comments 7
Catherine_B
QuickBooks Team

Form 940 with care act qualified wages ( care act employer retention credit)

Hello there, Rosyinoregon.

 

We can start troubleshooting by updating QuickBooks Desktop to its latest release and the payroll tax table to get the up-to-date fixes within the system. Then, we can start looking into your payroll Form 940 by tracking the types assigned to the payroll items in QuickBooks. 

 

Line 4 is computed from the total exempt payments it includes QuickBooks payroll items with the following tax tracking types such as Fringe benefits, Retirement/Pension, Dependent Care, other exempt payments, and any payroll item set to calculate before FUTA withholding. We can run the Payroll Item Listing report to see the tax tracking types assigned to the payroll items.

 

  1. Go to the Reports menu.
  2. Choose Employees & Payroll.
  3. Click Payroll Item Listing

Then, you can run the Payroll Checkup and make adjustments. Just make sure you've created a backup file for your company. 

 

You can use this link for more details on how QuickBooks populates the 940.

 

Keep me posted on how this works. Take care and have a great day!

Rosyinoregon
Level 1

Form 940 with care act qualified wages ( care act employer retention credit)

I am new here and don't know how to use it well.   In the beginning,  I can not find where my post was, then I finally found it and  typed a lot , but failed to post as "no authentication"  so I tested here before I rewrite it 

Rosyinoregon
Level 1

Form 940 with care act qualified wages ( care act employer retention credit)

Hi, Catherine, thank you so much for your so quick reply, though I just find the way how to find my post.

 

I update the QB and run the payroll check-up, though I stop in state tax there as we have an employee who works overseas and doesn't need to withhold state tax. In the beginning, I used a no income tax state, but then found he used IA as an address, and QuickBooks wants me to set up IA information too, so I stop there. 

 

But everything is the same in form 940, line 4 still is a negative amount.

 

let me write it in more details:

 

the company has 4 employees, in payroll summary, regular wages is 64310m care act retention emp is 35000, so total is 99310,

 

but in form 940,

 

line 3 is 64310 ( not 99310)

line 4 for is -35000

line 5 71310

line 6 36310

line 7 28000

line 8 168

 

I don't know why line 3 was not 99310 and line 4 was a negative amount. Please help, thanks!

 

 

 

 

RCV
QuickBooks Team
QuickBooks Team

Form 940 with care act qualified wages ( care act employer retention credit)

Thanks for coming back, Rosyinoregon.

 

QuickBooks populates Line 3 for total payments to all employees from your employee's paychecks. Then, it totals all the payroll item types of Compensation, Reported Tips, Dependent Care FSA, Section 457 Distribution, Non-qual. Plan Distr, Fringe Benefits, Other Moving Expenses, 401(k), 403(b), 408(k)(6) SEP, Elective 457(b), Simple IRA, Taxable Grp Term Life, Med Care Flex Spend, Premium Only/125, SCorp Pd Med Premium. To verify the amount, just follow the steps below:

  1. Run a Payroll Item Listing report.
  2. Filter the report and, in the Columns, clear everything but the Payroll Item and tax-tracking type.
  3. Print the report.
  4. Place a checkmark next to any item that has a tax-tracking type of Compensation, Reported Tips, Dependent Care FSA, Section 457 Distribution, Non-qual. Plan Distr, Fringe Benefits, Other Moving Expenses, 401(k), 403(b), 408(k)(6)SEP, Elective 457(b), Simple IRA, Taxable Grp Term Life, Med Care Flex Spend, Premium Only/125, SCorp Pd Med Premium.
  5. Run a Payroll Summary report for the calendar year.
  6. Select Customize Report.
  7. Tap the Filters tab. Then, under the Current filter choices, select Payroll Item.
  8. In the drop-down box in the middle, select Multiple Payroll Items. Check off all the payroll items you marked earlier.
  9. Add together the Adjusted Gross Pay, Total Employer Taxes, and Contributions.

If any of them are incorrect, the tax-tracking type needs to be modified. To change a tax-tracking type, here's how:

  1. Go to the Payroll Item List.
  2. Double-click the payroll item in question.
  3. Select Next, until you get to Tax Tracking Type.
  4. Correct the tracking type and click Next until you reach Finish. This will correct the form, but if the taxability changed, run a payroll checkup to correct the taxable wage bases.

For Line 4, the software populates this line in exempt payments included in the total payments to all employees. They are computed from the total exempt payments on the interview worksheet. To verify why the amount is negative, please follow the steps below:

  1. Run a Payroll Item Listing report to see the tax tracking types assigned to the payroll items in QuickBooks. To run a Payroll Item Listing report, go to the Reports menu, choose Employees & Payroll, and click Payroll Item Listing. The Payroll Item Listing report displays detailed information about all defined payroll items, including their tax tracking types. With this report, you can identify the items that impact the amount on Line. These tax tracking types are Fringe benefits, Group Term Life Insurance, Retirement/Pension, Dependent Care
  2. Then, run a Payroll Summary report for the Form 940 filing period and note the amounts for the payroll items with the matching tax tracking types. To run a Payroll Summary report, go to the Reports menu, choose Employees & Payroll, and select Payroll Summary. If necessary, change the date range in the report window to Last Calendar Year. You can also filter the Payroll Summary report to show only the desired payroll items and their amounts.

If the same thing happens after reviewing and correcting everything, please contact our Payroll Support Team. They'll pull up your account in a secure environment and help you with this one. To ensure we address your concern, our representatives are available from 6:00 AM to 6:00 PM on weekdays and 6:00 AM - 3:00 PM on Saturdays, PST. See our support hours and types for more details about this one.

 

Visit our Tax forms page to learn more about adding and managing your tax forms in QuickBooks. 

 

The Community will always have your back if you need anything else in QuickBooks. Assistance is just one click away. You have a good one. 

Rosyinoregon
Level 1

Form 940 with care act qualified wages ( care act employer retention credit)

Hi, RCV, thanks for the reply.

 

But I have done those already, can you please more specific on Care act retention credit? I follow the instruction to set up and i RUN the payroll checkup, everything is fine ,but the 940  line 4 still is nagative.

 

Thanks!

Rosyinoregon
Level 1

Form 940 with care act qualified wages ( care act employer retention credit)

I checked up each item again and everything matches the steps in QuickBooks's instructions regarding set up care act retention credit.

JenoP
QuickBooks Team

Form 940 with care act qualified wages ( care act employer retention credit)

Thanks for keeping us updated for sharing additional details, Rosyinoregon.

 

I read all the responses in this thread and it looks like all of the possible troubleshooting steps and relevant articles have already been shared. 

 

In this case, I would recommend reaching out to our Payroll Support Team. They can take a look at your Form 940 and help you run payroll reports to determine why Line 4 is giving you a negative amount. Here's how:

 

  1. Go to the Help menu, then select QuickBooks Desktop Help.
  2. Select Contact Us.
  3. Give a brief description of your issue, then select Let's talk and choose a way to connect.

You can also reach out to our Chat Support Team by clicking the links that corresponds to the type of subscription that you're using:

 

Before I end my response, let me share this checklist for additional reference when performing your year-end tasks: Year-end Checklist For QuickBooks Desktop Payroll.

 

Don't hesitate to reach out to us again if you need more help with QuickBooks Payroll.

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