Solo 401K amounts on 940 (FUTA) and W2
Hi
Appreciate your assistance on this question related to the 940 form (FUTA Tax Return).
Consider these #s:
I have an S-corp and pay myself a salary. Also have a Solo 401K with Employee and Employer (Profit Sharing) portions.
Medicare Wages = 160K
Solo 401K Employee portion = 24K (> 50 years of age)
Solo 401K Employer portion = 36K
So W2 Taxable Wages = 160K – 24K = 136K
1) What needs to go on Box 3 (Total payments to all employees)?
Is it 136K (=160K – 24K)
or 160K
or 196K (=160K + 36K)?
2) What needs to go on Box 4 (Payments exempt from FUTA tax)?
Is it 0 or 24K or 60K?
3) What needs to be shown for 401K with code D on the W2?
Is it 24K or 60K?
I believe the answers are 160K and 24K and 24K, with the 36K showing up only on the 1120S.
Please let me know if you have any questions for clarifications.
Thanks!
Permalink Submitted by MaryKay Foss on Fri, 2019-01-18 02:34
I don’t have the forms to comment on but:401k deferrals are not exempt from FICA and FUTA taxesBox 1 of Form W-2 shows wages reduced by the 401k deferral – that amount also shows on code D. The maximum deferral would be shown with code D.FICA wages are limited to the FICA maximum for the year. Medicare wages are the total amount paid including the 401k deferral.If the S corporation pays for health insurance that amount has to be included with the box 1 wages.