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Jessamyn_F
Level 1

Tax Tracking for Simple IRA

I am getting ready to file our annual Form 940 for 2019.  Line 3 includes the total of our Simple IRA company match, which is also indicated on Line 4 of the 940.  Our accountant said the company match should not be included in Line 3 (total payments to employees) and should not be listed on Line 4 (payments exempt from FUTA).   In the set up of the Simple IRA co-match, the system auto populated the tax tracking as Simple IRA co. match.  Should I override this to be NONE?

Thank you, ~JF

1 Comment 1
MaryLandT
Moderator

Tax Tracking for Simple IRA

Good day, Jessamyn_F,

 

The Simple IRA plan is reported on the federal forms listed below:

  • 941 or 944: Decreases wages in line 1 or line 2
  • 940: Included wages in line 3
  • W-2: Decreases box 1, $ amount in box 12 with code S, and Retirement Plan is checked in box 13.

While the Simple IRA Co. Match is reported:

  • 941 or 944: Not included in wages in lines 2, 5a, 5c or lines 1, 4a, 4c.
  • 940: Increases wages in line 3, increases exempt payments in line 4, and box 4c is checked.
  • W-2: Not included in wages boxes 1,3 5, and Retirement Plan is checked in box 13.

If you select None, the Simple IRA Co. Match isn't reported to any forms. I recommend consulting with your accountant again to verify if it's the right thing to do. He/She might have specific instructions on how to set up the plan.

 

I've added the Set up a payroll item for retirement benefits (401(K), Simple IRA, etc.) for more details on how to properly enter them in QuickBooks Desktop Payroll.

 

Don't hesitate to leave a comment below if you need additional information. I'm happy to help you out.

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