TT Home and Business filled more than 7000 for wages subject to FUTA for nanny tax

[k371]

I am completing the section for Nanny Tax under Other Tax Situations in TT Home and Business 2017.

TT asks me for wages subject to social security tax and medicate tax. The ampunt is about 30,000. I filled that. I am in CA so I checked the boxes accordingly on subsequent screens.

However when I look at the "forms View", TT shows a FUTA tax of about $1500 on Schedule H. This looked high and the issue I found is that on line 20 of schedule H, TT has filled in the entire 30k as wages subject to FUTA instead of 7000. 

Seems from IRS that only 7000 should be filled for FUTA tax wages. https://www.irs.gov/taxtopics/tc759.

Where do I fix my entries in TT Home and Business to get correct schedule H calculations?

[PatriciaV · Accepted solution]

Yes, you can correct this by reviewing your answers to the interview questions under Nanny Tax.

On the screen "State Information" where you enter the state unemployment taxes you paid, be sure you did not enter more than $7,000 in the box for "State Taxable Wages" (see screenshot below - click to enlarge). If you owed or paid zero taxes, enter zero for those boxes.

On the screen "Wages for FUTA," enter a maximum of $7,000 in the box for "Total Wages Subject to FUTA" (screenshot #2).

If you don't see one or the other of these screens, go back and check/uncheck the boxes on the page "Unemployment Tax Information" (screenshot #3) until you are able to enter $7,000 or less for both State and Federal unemployment wages.

Now check Schedule H-T in Forms Mode. Section A should be complete and Line 16 should reflect the correct amount of FUTA tax on a maximum of $7,000 of wages.

[k371]

Thanks! this fixed it.

I had not realized that "State Taxable Wages" on Screenshot 1 refer to 'wages subject to state UNEMPLOYMENT tax' since the phrase state taxable wages typically (for W2 etc.) refers to wages subject to state income tax.

[PatriciaV]

Yes, the description is not as clear as it should be.