Instructions For Form 940-Ez - Employer'S Annual Federal Unemployment (Futa) Tax Return - Internal Revenue Service - 2001 Page 4

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Part I — Taxable Wages
Specific Instructions
and FUTA Tax
You must complete lines A and B and Part I. If your
Line 1 — Total payments. Enter the total payments
FUTA tax (line 6) is over $100, you must also complete
(before any deductions) you made during the calendar
Part II. Please remember to sign the return.
year for services of employees, even if the payments are
Employer’s name, address, calendar year and
not taxable for FUTA tax. Include salaries, wages,
employer identification number (EIN). If you are not
commissions, fees, bonuses, vacation allowances, and
using a preaddressed Form 940-EZ, type or print your
amounts paid to temporary or part-time employees; the
name, trade name, address, calendar tax year, and EIN
value of goods, lodging, food, clothing, and noncash
on the form. Enter your name, address, calendar tax
fringe benefits; contributions to a 401(k) plan, payments
year, and EIN here, even if you must complete Form
to an Archer MSA, payments under adoption assistance
940-EZ(V), Form 940-EZ Payment Voucher.
programs, and contributions to SIMPLE retirement
accounts (including elective salary reduction
If you do not have an EIN, apply for one on Form
contributions); section 125 (cafeteria) plan benefits; and
SS-4, Application for Employer Identification Number. If
sick pay (including third-party sick pay if liability is
you do not have an EIN by the time a return is due, write
transferred to the employer).
“Applied For” and the date you applied for the number.
For details on sick pay, see Pub. 15-A, Employer’s
Line A. Enter the amount of your state unemployment
Supplemental Tax Guide. Report amounts deferred
contributions for 2001 that you paid by January 31, 2002
under a nonqualified deferred compensation plan at the
(or February 11, 2002, if that is your Form 940-EZ due
later of (a) when services are performed or (b) when
date). If your state has given you a 0% experience rate
there is no substantial risk of forfeiture of the rights to the
so there are no required contributions, enter “0% rate.”
deferred amount. For details, see Regulations section
31.3306(r)(2)-1. Also, include tips of $20 or more in a
Line B(1). Enter the state where you pay state
month reported to you by your employees.
unemployment contributions. If you pay to more than
Your method of payment does not determine whether
one state, you must file Form 940.
payments are wages. Thus, you may pay wages hourly,
Line B(2). Enter your state reporting number.
daily, weekly, monthly, or yearly. You may pay wages for
piecework or as a percentage of profits. You may pay
Final return. If you will not have to file Form 940-EZ (or
wages in cash or some other way, such as goods,
940) in the future, check the box on the line below line
lodging, food, or clothing. For items other than cash, use
B(2) and complete and sign the return. If you start paying
the fair market value when paid.
FUTA wages again, file Form 940-EZ (or 940).
Line 2 — Exempt payments. The amounts reported on
Third party designee. If you want to allow an employee
line 2 are exempt from FUTA tax. For FUTA tax
of your business or an individual paid preparer to discuss
purposes, “wages” and “employment” do not include
your 2001 Form 940-EZ with the IRS, check the “Yes”
every payment and every kind of service an employee
box in the “Third Party Designee” section of the return.
may perform. In general, payments excluded from wages
Also, enter the name, phone number, and any five
and payments for services excepted from employment
numbers the designee chooses as his or her personal
are not subject to FUTA tax. Do not enter payments
identification number (PIN). The designation must specify
over $7,000 for each employee that you enter on
an individual and may not refer to your payroll office or a
line 3.
tax preparation firm.
You may deduct exempt payments from total
By checking the “Yes” box, you are authorizing the
payments only if you explain them on line 2. Amounts
IRS to call the designated employee or paid preparer to
that may be exempt from your state’s unemployment tax
answer any questions that may arise during the
may not be exempt from FUTA tax. For example,
processing of your return. You are also authorizing the
corporate officers’ wages are not exempt from FUTA
designee to:
tax even though your state may exempt those wages
Give the IRS any information that is missing from your
from its unemployment tax.
return,
Enter payments such as the following on line 2.
Call the IRS for information about the processing of
These payments also must be entered on line 1.
your return or the status of your refund or payment(s),
1. Agricultural labor if you did not meet either 1 or 2
and
under Agricultural employers on page 2 and all
Respond to certain IRS notices that you have shared
payments to H-2(A) visa workers.
with the designee about math errors and return
2. Benefit payments for sickness or injury under a
preparation. The notices will not be sent to the designee.
workers’ compensation law.
You are not authorizing the designee to receive any
3. Household service if you did not pay total cash
refund check, bind you to anything (including additional
wages of $1,000 or more in any calendar quarter in 2000
tax liability), or otherwise represent you before the IRS. If
or 2001.
you want to expand the designee’s authorization, see
4. Certain family employment. (See Section 3 in
Pub. 947, Practice Before the IRS and Power of
Circular E.)
Attorney.
5. Certain fishing activities. (See Pub. 595, Tax
The designee authorization cannot be revoked.
Highlights for Commercial Fishermen.)
However, the authorization will automatically expire on
6. Noncash payments for farmwork or household
the due date (without regard to extensions) for filing your
services in a private home. (Only cash wages paid to
2002 Form 940-EZ (or 940).
these workers are taxable.)
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