Employer Reconciliation
What Employers Need to Know

                          I received a Reconciliation MissingReport Questionnaire (SSA-97-SM) from the Social Security Administration. What should I do?

                          ANSWER:

                          The Internal Revenue Service received employment tax return(s) from you and SSA has no corresponding wage report(s).

                          You should check your records for the following before you respond to the questionnaire:

                          1a. Did you use the correct version of Form W-3 (Transmittal of Income and Tax Statements) and W-2 (Wage and Tax Statements) for the tax year being reported or

                          1b. Did you use the correct tax year when you filed electronically?

                          If not, the wages were probably credited for the wrong year. In this event, provide us with transmittal Form W-3c and Forms W-2c (Statement of Corrected Income and Tax Amounts) for each employee showing the correct information.

                          2. Do you still have copy "A" of the Form W-2(s), or your electronic report which may have been returned to you for correction? If so, please send them for processing to the address shown on the questionnaire: or

                          3. Did you show the correct employer name and/or employer identification number (EIN) on your reports? If the name or number was omitted or incorrectly shown, explain this on the questionnaire. Be sure to include the correct and incorrect employer name and EIN. This will help us search for the "missing" report in our records. Send changes to the address shown on the questionnaire.

                          If any of these errors have occurred and you are providing copies of Forms W-2 to correct the records, compare the wage totals on these Forms W-2 to those wage totals shown on the enclosed questionnaire (these are the totals you reported to IRS). If these amounts are not the same, explain why on the questionnaire and mail to the address shown on the questionnaire.

                          If none of the checks listed above identify the problem, return a copy of your wage report(s) to SSA for possible reprocessing.

                          QUESTION:

                          I received a Reconciliation Discrepant Report Questionnaire (SSA-L-97-SM) from the Social Security Administration. What should I do?

                          ANSWER:

                          A. You may have completed a Form W-2 incorrectly. Check to see if any of the following errors were made.

1. Void box checked in error (if so, send us a new copy "A" of the form W-2);
2. Amount shown in the Social Security wages, Social Security tips, and/or in the Medicare wages/tips field for one or more W-2's is incorrect;
3. Employer portion of the FICA taxes was incorrectly deducted from or added to the reported FICA wage amount;
4. Social Security wage field is incomplete because all Social Security wages, including such special payments as bonuses or awards, are not included;
5. Medicare wages/tips entry is less than all the employees' covered wages (there is no maximum taxable limit on Medicare wages for years after 1993).

                          B. Prepare Forms W-3c and W-2c to correct them. If none of these errors seem to apply, check further to see if any of the following errors were made:

1. Household employees were included in your Form 941 (Employer's Quarterly Federal Tax Return), Form 943 (Employer's Annual Tax Return for Agricultural Employees), Form 1040 (schedule H) or Form 944 (Employers Annual Federal Tax Return) totals, but you did not include copy "A" of the Form W-2 for them in your report to SSA. If so, provide us with these forms.
2. The EIN you used to report wages to IRS and SSA was not the same as the one used for IRS; or, if you used more than one EIN during the year, you reported different wage amounts to SSA than to IRS under one or more EINs. If you did not report the same wage amount under each EIN to both SSA and IRS, explain this on the questionnaire and show all EIN's used during the tax year.
3. W-2's for all your employees were not sent to SSA. If Copy "A" of Form W-2 was not sent for some employees, return the missing forms with the questionnaire.
4. The Form 941's were completed incorrectly. Examples of these errors are:
   
   1. Non-FICA wages (wages not subject to FICA taxes): Individual Retirement Accounts (IRA's) or other non-wage payments were incorrectly shown as FICA wages;
   2. Self-employment income amounts were shown as Social Security and Medicare wages (for example, a minister's salary);
   3. Social Security wages over the maximum taxable Social Security limit were reported for one or more employees;
   4. Third-party sick pay was improperly reported (See IRS Publication IRS 15A "Sick Pay Reporting").

If any of these errors listed immediately above have been made but the amounts reported to SSA are correct, explain this on the questionnaire. You may file Form 941c together with a copy of your original 941 or Form 843 (Claim for Refund and Request for Abatement) with IRS for a refund if you overpaid wage taxes.

NOTE: Always keep records to back up your wage and tax reports should SSA or IRS have questions about them at a later date.