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860717
Schedule R (Form 940) (Rev. 12-2017)
Section references are to the Internal Revenue Code unless otherwise Column a. Your client’s EIN.
noted. Column b. The state abbreviation of the client’s location.
Future Developments Column c (CPEO Use Only). Type of wages, tips, and other
compensation. Enter a code to report the type of wages, tips, and other
For the latest information about developments related to Schedule R and compensation paid to the individual(s) performing services for the client.
its instructions, such as legislation enacted after they were published, go If you paid more than one type of wages, tips, or other compensation,
to www.irs.gov/Form940. you must use more than one line to report for that client and enter the
applicable code for each line. The following four codes are the only
What’s New entries that can be made in column c.
A certified professional employer organization (CPEO) must attach • A: Wages, tips, and other compensation paid under section 3511(a).
Schedule R to its aggregate Form 940, Employer’s Annual Federal • B: Wages, tips, and other compensation paid under section 3511(c).
Unemployment (FUTA) Tax Return.
• C: Wages, tips, and other compensation not reported under Code A
or Code B paid as a payor under a service agreement described in
General Instructions Regulations section 31.3504-2(b)(2).
Purpose of Schedule R • D: Wages, tips, and other compensation paid as an agent under
Regulations section 31.3504-1.
Use Schedule R to allocate the aggregate information reported on Form Column d. Total taxable FUTA wages allocated to the listed client EIN
940 to each client. For purposes of Schedule R, the term “client” means from Form 940, line 7.
(a) a home care service recipient identified on the Form 2678, Employer/
Payer Appointment of Agent; (b) a customer who enters into a contract Column e. Total adjustments to FUTA tax allocated to the listed client
that meets the requirements under section 7705(e)(2); or (c) a client who EIN from Form 940, line 9 or 10.
enters into a service agreement described under Regulations section Column f. Credit reduction amount allocated to the listed client EIN from
31.3504-2(b)(2) with a CPEO. If you have more than 15 clients, complete Form 940, line 11.
as many continuation sheets as necessary. Attach Schedule R, including
any continuation sheets, to your aggregate Form 940. Column g. Total FUTA tax after adjustments allocated to the listed client
EIN from Form 940, line 12.
Who Must File? Column h. Total FUTA tax deposits from Form 940, line 13, plus any
You must complete Schedule R if you file an aggregate Form 940. other payments allocated to the listed client EIN.
Aggregate Forms 940 are filed by agents of home care service recipients You must also report the same information for your employees on
approved by the IRS under section 3504 and by CPEOs. To request Schedule R, line 18.
approval to act as an agent for a home care service recipient, you must Compare the total of each column on Schedule R, line 19 (including
file Form 2678 with the IRS, unless you are a state or local government your information from Schedule R, line 18) to the amounts reported on
agency acting as agent under the special procedures provided in Rev. the aggregate Form 940. For each column total, the relevant line from
Proc. 2013-39. Form 2678 must be previously filed and approved by the Form 940 is noted in the column heading.
IRS before filing Schedule R. To become a CPEO, you must apply
through the IRS Online Registration System. Visit www.irs.gov/CPEO for If the totals on Schedule R, line 19, don’t match the totals on Form
more information. 940, there is an error that must be corrected before submitting Form 940
and Schedule R.
When Must You File?
Paperwork Reduction Act Notice. We ask for the information on
If you’re an aggregate Form 940 filer, file Schedule R with your Schedule R to carry out the Internal Revenue laws of the United States.
aggregate Form 940 every year when your Form 940 is due. Agents may You are required to give us this information. We need it to ensure that
file Form 940 and Schedule R electronically or by paper submission. you are complying with these laws and to allow us to figure and collect
CPEOs generally must file Form 940 and Schedule R electronically. For the right amount of tax.
more information about a CPEO’s requirement to file electronically, see
Rev. Proc. 2017-14, 2017-3 I.R.B. 426, available at You’re not required to provide the information requested on a form
www.irs.gov/irb/2017-03_IRB/ar14.html. that is subject to the Paperwork Reduction Act unless the form displays
a valid OMB control number. Books or records relating to a form or its
instructions must be retained as long as their contents may become
Specific Instructions material in the administration of any Internal Revenue law. Generally, tax
returns and return information are confidential, as required by section
Completing Schedule R 6103.
Enter Your Business Information The time needed to complete and file Schedule R will vary depending
on individual circumstances. The estimated average time is:
Carefully enter your employer identification number (EIN) and the name
of your business at the top of the schedule. Make sure they exactly Recordkeeping . . . . . . . . . . . . . . . 11 hr.
match the EIN and name shown on the attached Form 940. Check one Learning about the law or the form . . . . . . . . 18 min.
of the “Type of filer” boxes to tell us if you’re a section 3504 agent or a Preparing, copying, and assembling the form . . . . . 29 min.
CPEO.
If you have comments concerning the accuracy of these time
Calendar Year estimates or suggestions for making Schedule R simpler, we would be
happy to hear from you. You can send us comments from
Enter the calendar year for which you are filing your Form 940. Make www.irs.gov/FormComments. Or you can send your comments to
sure that the year entered on the top of Schedule R matches the year on Internal Revenue Service, Tax Forms and Publications Division, 1111
the attached Form 940. Constitution Ave., NW, IR-6526, Washington, DC 20224. Don’t send
Client and Employee Information Schedule R to this address. Instead, see Where Do You File? in the
Instructions for Form 940.
On Schedule R, including any continuation sheets, you must report the
following for each client.
Note: When entering amounts over 999.99 on Schedule R, don’t enter
commas.
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