Rev. Proc. 69-9

Section 1. Purpose and Scope.

.01 This Revenue Procedure relates to the following employment tax returns or statements:

Form W-2, Wage and Tax Statement;

Form W-3, Reconciliation of Income Tax Withheld and Transmittal of Wage and Tax Statements; and

Form 941, Employer's Quarterly Federal Tax Return. .02 The purpose of this Revenue Procedure is to explain both the standard procedure and an acceptable alternative procedure for preparing and filing Forms W-2, W-3, and 941 when an employer (hereinafter called a successor) acquires substantially all the property (1) used in a trade or business of another employer (hereinafter called a predecessor), or (2) used in a separate unit of a trade or business of a predecessor, and immediately after the acquisition (but during the same calendar year) the successor employs in his trade or business individuals who immediately prior to the acquisition were employed in the trade or business of the predecessor. (The words "trade or business," for purposes of this Revenue Procedure, may include the activity of a nonprofit organization or of a Federal or State agency.)

.03 This Revenue Procedure does not apply under the circumstances stated in Revenue Ruling 62-60, C.B. 1962-1, 186, which relates to the absorption of one corporation by another in a statutory merger or consolidation, and in which the resultant entity is regarded as the same taxpayer and same employer as the absorbed corporation.

Sec. 2. Standard Procedure.

.01 When a predecessor makes his final payment of wages to an employee under the circumstances stated in section 1.02, above, the predecessor ordinarily is required to furnish a Form W-2 to the employee on or before the thirtieth day following the day on which the final payment is made. Section 31.6051-1(d) of the Employment Tax Regulations.

.02 The predecessor's return on Form 941 for the last quarter of the calendar year, or his "Final return" on Form 941 if he ceases to pay wages, ordinarily would be accompanied by the Internal Revenue Service copies of each of such Forms W-2 and by the predecessor's Form W-3. Section 31.6011(a)-4(b) of the regulations.

.03 Under the standard procedure, the predecessor thus performs all reporting duties in respect of the wages and other compensation he pays. The successor, under standard procedure, reports only his own payments of wages and other compensation.

Sec. 3. Alternative Procedure.

.01 If the predecessor and successor so agree, the predecessor may be relieved from furnishing a Form W-2 to any employee to whom he makes a final payment of wages under the circumstances stated in section 1.02. In such circumstances the employee presumably will be paid wages by the successor in the same calendar year, and the Form W-2 furnished to the employee by the successor for the year may include the wages paid, and taxes withheld, by both the predecessor and the successor. If the successor assumes the predecessor's obligation to furnish Forms W-2 to employees for a calendar year, the successor must assume the predecessor's entire obligation. Thus, the successor must include in such a Form W-2 any amount reportable by the predecessor as "Other compensation" or as uncollected employee tax on tips.

.02 To the extent that wages paid and income tax withheld by the predecessor are to be included in the successor's Form W-2, there will be a difference between the predecessor's Form W-3 and his returns on Form 941. When the predecessor files his return on Form 941, accompanied by his Form W-3, his explanation of the discrepancy should include the name, address, and identification number of the successor and a reference to this Revenue Procedure. The predecessor's Form 941 and Form W-3 also must be accompanied by copies of Forms W-2 furnished by the predecessor to his employees (for example, to employees who were not employed by the successor immediately after his acquisition of the trade or business).

.03 To the extent of the difference referred to in section 3.02, there will be a corresponding difference between the successor's Form W-3 and his returns on Form 941. The successor's explanation of the discrepancy should include the predecessor's name, address, and identification number and a reference to this Revenue Procedure. For instructions relating to annual wage limitations, see section 31.3121(a)(1)-1 of the regulations.

Sec. 4. Inquiries.

Inquiries concerning this Revenue Procedure should refer to its number and should be addressed to the Director, Internal Revenue Service Center, serving the district in which the predecessor or successor is located.

Sec. 5. Effect on Other Documents.

This Revenue Procedure supersedes Revenue Procedure 66-41, C.B. 1966-2, 1249.