I am puzzled by your sentence “The form 940 doesn’t include National Paid leave” at the beginning of your reply.
My concern is with the Tax Form Worksheet that shows 940 information and is generated from the More Payroll Reports in Excel option. It is not with the Form 940 that is filed with the IRS.
My research indicates form 940 should include National Paid Leave on Line 3 .
I ran the Payroll Summary report as you instructed and it agrees with the form 940 and does include the National Paid Leave on Line 3-Total payments to employees. That amount is $174,000 (fictitious number for demonstration purposes).
I do not think you and I are focusing on the same issue so I will be more specific.
The Tax Form Worksheet shows (fictitious numbers for demonstration purposes).
Total Payments to Employees
Exempt Payments - by Tax Tracking
Additional Exempt Payments based on Taxability Settings
Total taxed wages:
Total taxable FUTA Wages:
Difference (should be 0.00):
If you click on the Total Taxable FUTA wages the formula shows that the $143,000 is derived by (a) subtracting the $168,000 (which is an amount after subtracting $6000 National Paid Leave to employees ) and (b) subtracts the $19,000 which is shareholder medical ins and (c) again subtracts the $6000 National Paid Leave that is in “Additional exempt payments based on Taxablility Settings”.
The specific questions relate to this double subtraction for National Paid Leave on the “Total taxable FUTA wages” line of the worksheet. My research indicates National paid leave is subject to FUTA.
(1) why does the Tax Form Worksheet show total payments to Employees after reducing for the National Paid Leave (168,000) instead of the amount that the Form 940 shows on Line 3 which includes National Paid Leave (174,000)?
(2) Why is the National Paid Leave which is being shown in “additional exempt payments based on Taxability Settings” being subtracted at all on the worksheet?