Standard Payroll, Enhanced Payroll, and Enhanced for Accountants: FAQs for 2014 FUTA Credit Reduction States
This article explains how the Federal Unemployment Tax Act (FUTA) credit reduction affects your FUTA taxes, Form 940, and Schedule A for 2014.
For calendar year 2014, 8 states have been identified as credit reduction states:
You have an active QuickBooks payroll subscription and a supported version of QuickBooks.
Frequently Asked Questions
What do I need to do?
Download Payroll Update 21502 on or after December 29, 2014.
What do I do next?
- Process your Form 940 and Schedule A (Form 940) for 2014 in QuickBooks.
- Make the necessary payroll liability adjustments in QuickBooks to account for the additional taxes due to credit reduction: see Form 940, Line 11, if credit reduction applies, enter the total from Schedule A (Form 940).
- Adjusting payroll liabilities
- Attach your Schedule A to your Form 940 and file your forms and pay your taxes due as provided in the instructions for Form 940.
You may also use the E-file and Pay feature to file and pay your Form 940 and Schedule A (Form 940).
What do I do if I have already submitted the 940 Form but the credit reduction was not reported?
- Process your Form 940 for 2014 in QuickBooks.
- Check the amended box in the top right corner of Form 940, page 1, box a.
- Take note of the credit reduction amount reported in Line 11. If the amount is zero, download the latest tax table version.
- Print and sign the form. (Paper return are used to amend a Form 940 that was e-filed.)
- Attach an explanation of why you are amending your return. For example, you are amending your return to report the credit reduction amount.
- Enter a liability adjustment to record the credit reduction amount in QuickBooks.
- Attach your Schedule A to your Form 940 and file your forms and pay the amount due. (File the amended return using the Without a payment address (even if a payment is included) under Where Do You File.