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Experienced Member

How do I include predecessor wages for 940 futa return and check box B

I'm setting up my daughter's acquired dental practice on QB and QB payroll.  I'm waiting for the predecessor's accountant to give me the gross wages of their employees that I can include as paid by my daughter's new practice since she hired all the former employees and is a qualified successor employer.  Do I just set the dollar limits at $7000 in wages less the amount they were paid by the predecessor employer?

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QuickBooks Team

Re: How do I include predecessor wages for 940 futa return and check box B

Thanks for coming in with us today, thekval.


The Form 940 instructions includes special calculations on how to offset a transferred employee's wage by the wages paid by the predecessor employer and special instructions requiring employers to mark box B.


To learn more about handling predecessor wages as a successor employer, you can checkout this article (see Successor employer): Form 940 Instructions.


Also, I'd suggest consulting an accountant to help and guide on recording this in QuickBooks. They can provide more expert advice in dealing when a successor carries over the FUTA wage base from the transferred employee.


Should you have other payroll concerns aside from this, feel free to reach back to me. I'd be happy to assist.​​​​​​​​