Form 941 & 940

[TAXNJ]

With the new reporting requirements on these forms:

Question: How are the "children" under 17" who work for the family business and Social Security/Medicare" not withheld reported?

W-2/W-3 Reporting:
Would it be under the "do you have any special situations" section and check the box for
"statutory employees"

Form 940:
Would it be under Part 2 "Specify any exempt payments" - "classification" - "Other"?

thank you in advance

[Brad Imsdahl]

Wages paid to children under 18 are exempt from FICA and FUTA. On the 941, Social Security and Medicare Wages paid to such an individual would equal zero. On the 940, such wages would be considered “exempt.”

Children under 18 are not statutory employees, unless they meet the statutory employee definition (TTB page 5-9).

[TAXNJ]

BRAD THANKS ? clearer on form 940

When mentioning the form 940, I should have been clearer. In the past, it (940) required more detail especially for listing the type of "exempt payments".

The new revised 940 the exempt payments for "employers children under 18" would now be show on line 4e "other" on the form 940 - would that be correct?

[Brad Imsdahl]

That is correct. The Form 940 instructions on page 6 tell you to put payments for services provided to you by your parent, spouse, or child under the age of 21 on line 4e.