[ 2.9.1 - Established in Error Defined ][ 2.9.2 - Established in Error - One Account ][ 2.9.3 - Established in Error - Two Accounts ( Duplicate) ][ 2.9.4 - Established in Error - Account Closed ]

This section explains how to make corrections when state unemployment tax accounts are set up by mistake.

Established in Error is a term used to describe an account which was erroneously entered on the Employer Master File.

The term Established in Error applies to two different situations. One situation involves a single account number while the second situation involves duplicate or multiple account numbers. Once an account has been converted to Established in Error no further Status changes may be processed to the account. For this reason it is important to be certain that an account was established in error before proceeding. If an account is mistakenly closed as Established in Error the transaction cannot be reversed. A new account number must be assigned.

Sometimes liability is mistakenly established for an Employer where no liability exists. When the error is discovered it is necessary to close the account as Established in Error.

Pending and Not Liable accounts should be closed as Established in Error only in certain instances. See Chapter 2 – “Established in Error - Two Accounts (Duplicate)”.

To change a Liable account to Established in Error prepare a Form C-10 or access the Status Action Screen (STA). A Form C-10 should be prepared only in situations where a transaction can not be performed on the STA screen because of STA screen edits.

Access the STA screen.

1. Key ACCT

Press <Enter>

2. Delete the Federal Identification Number.

3. Key REG   CODE  =>  8

DOM CODE  => 8

AGR  CODE  => 8

An inactivation date should be keyed for each type of Employment under which the account is showing as Liable. The inactivation date should be the same as the first wages date for the account.

4. Key REG    SUSPD DT

DOM  SUSPD DT

AGR   SUSPD DT   AGR => 1, 2 OR 3

A final wages date should be keyed for each type of Employment under which the account is showing as Liable. The final wages date should be the same as the first wages date for the account.

5. Key  REG    NORPTDUE

DOM   NORPTDUE

AGR    NORPTDUE

The reason code should be keyed for each type of Employment under which the account is showing as Liable.

6. Key REG   REAS => 1

DOM  REAS => 1

AGR   REAS => 1

The grid does not have to be coded when using the STA Screen in this situation.

7. Press <PF5> to add the record.

If Quarterly Reports are posted to the account which is being closed as Established in Error, document FTC explaining what should be done with the Quarterly Reports. For example, if you close an account as Established in Error and the Quarterly Reports need to be deleted and/or have money refunded, document FTC that Quarterly Reports should be deleted and money refunded, if appropriate.

The Employer should be notified regarding the changes made to the account. To notify the Employer, access the SLR screen and send letter FL-23. See Chapter 5 - “Form Letters – SLR Screen”.

A duplicate account occurs whenever an employing unit is assigned more than one account. The duplicate account might be Pending, Not Liable or Liable.

Whenever a duplicate account is discovered it is necessary to close the duplicate account as Established in Error. In addition it is necessary to move and reprocess important documents, posted under the Established in Error account, to the correct account. These documents might include Status Reports, Quarterly Reports, Correspondence and Written Authorizations. Put comments on the FTC screen your actions regarding any of these documents.

The first step in this process is to decide which of the accounts to close as Established in Error. Normally it is preferable to close the most recently established account however this is not always the best course of action. Please use the following examples as a guide in determining which account should be closed as Established in Error.

Situation 1

Duplicate accounts A and B set up for the same Employer. Both accounts are Liable. A was established in 2007 while B was established in 2008. All liability information for A and B is the same.

Solution

Close B as Established in Error. B is the more recent of the two accounts.

Situation 2

Duplicate accounts A and B set up for the same Employer. A is Liable. B is Pending or Not Liable.

Solution

Close B as Established in Error since A is Liable.

Situation 3

Duplicate accounts A and B set up for the same Employer. A, the oldest account, is erroneously set up under Section 201.021 while B, the newest established in 2008, is correctly set up under Section 201.022.

Solution

Close A as Established in Error. Although A is the older of the two accounts it is best to close A since fewer Status changes are required for the overall transaction.

Situation 4

Duplicate accounts A and B set up for the same Employer. Both accounts are Pending or Not Liable. The Employer's Quarterly Reports are posted under A. The Status Report is on the Transaction Log under B.

Solution

It does not matter which account is closed as Established in Error.

To change a duplicate account to Established in Error prepare a Form C-10 or access STA screen. A Form C-10 should be prepared only in situations where a transaction cannot be performed on STA screen because of STA screen edits.

Access the STA screen.

1. Key ACCT

Press <Enter>

2. Delete the Federal Identification Number.

3. Key the correct account the ESTB IN ERROR field (right side of screen under FEID).

4. Key  REG CODE   =>  8

DOM CODE  =>  8

AGR CODE   =>  8

An inactivation date should be keyed for each type of Employment under which the account is showing as Liable. The inactivation date should be the same as the first wages date for the account.

5. Key REG   SUSPD DT

DOM SUSPD DT

AGR  SUSPD DT         AGR 1, 2 or 3

A final wages date should be keyed for each type of Employment under which the account is showing as Liable. The final wages date should be the same as the first wages date for the account.

6. Key  REG   NORPTDUE

DOM  NORPTDUE

AGR   NORPTDUE

The reason code should be keyed for each type of Employment under which the account is showing as Liable.

7. Key  REG REAS  => 1

DOM REAS => 1

AGR REAS  => 1

The grid does have to be coded when using the STA screen in this situation.

8. Press <PF5> to add the record.

If Quarterly Reports are posted to the account which is being closed as Established in Error, e-mail ADP & Audit and document FTC regarding what you instructed ADP & Audit to do.

The Employer should be notified regarding the changes made to the account. Send SLR letter FL-83 that advises them of their correct account number. See Chapter 5 - “Form Letters – SLR Screen”.

Sometimes an account, which is already suspended, must be closed as Established in Error. If the suspend and final wages dates are not the same as the first wages date this type of transaction must be done in a two day process on STA.

Day 1

Access the STA screen

1. Key ACCT

Press <Enter>

2. Delete the Federal Identification Number.

3. Key the correct account in the ESTB IN ERROR field.

4. Key REG  CODE => 8
           DOM CODE => 8
           AGR  CODE => 8

5. Press <PF5> to save.

Day 2

The inactivation date should be amended to the same date as the first wages date.

Access the STA screen

1. Key ACCT

Press <Enter>

2. Key  REG  SUSPD DT
            DOM SUSPD DT
            AGR  SUSPD DT     AGR 1, 2, OR 3

The final wages date should be amended to the same date as the first wages date.

3. Key REG  NORPTDUE
           DOM NORPTDUE
           AGR  NORPTDUE

The reason code should be amended to reason 1.

4. Key REG REAS   => 1
           DOM REAS  => 1
           AGR REAS   => 1

The grid does not have to be coded when using the STA screen in this situation.

5. <PF5> to add the record.

If Quarterly Reports are posted to the account which is being closed as Established in Error, e-mail ADP & Audit and document FTC regarding what you instructed ADP & Audit to do.

The Employer should be notified regarding the changes made to the account. Notify the Employer in writing that the account has been closed as Established in Error SLR letter FL-23 and, in the case of duplicate accounts, which account they should use SLR letter FL-83. See Chapter 5 - “Form Letters – SLR Screen”.

Note: If the duplicate account is an internet registration, see Chapter 1 - “Liable Assignments”.