What is Form 940?

Learn more about IRS form 940. Includes a quick how-to section, and frequently asked questions.

Updated on November 19th, 2019

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Form 940 is an IRS tax form that employers use to report and pay federal unemployment taxes (FUTA) for employees. The funds collected through FUTA tax provide unemployment compensation to workers who have lost their jobs.

Employers do not deduct a percentage of their employees' wages but rather set aside an amount to pay both federal and state unemployment taxes annually.

How to Fill Out Form 940 Tax Form:

1. Fill out the first section with your basic identification.

In the first box, fill in your employer identification number, your name, trade name, and address.

2. Calculate your FUTA tax amount.

Complete Part 1 - 5 which determines your FUTA tax before and after adjustments, your balance due, and your FUTA tax liability.

3. Provide contact details for a designee.

Under Part 6, fill in the name of a third-party designee, such as an employee or tax preparer whom you would like to discuss the return with the IRS.

4. Sign the form.

Under Part 7, enter your name and sign the form.

To find out about reporting income taxes, social security tax, and Medicare taxes withheld from employees' paychecks, see our article on Form 941.

Form 940 FAQs:

Who Must File Form 940?

As an employer, you must file Form 940 if the following applies to you:

  • You have paid wages of $1,500.00 or more to employees in any calendar quarter during 2017 or 2018.
  • You have one or more employees (including full-time, part-time, and temporary employees) for at least part of a day in any 20 or more different weeks in 2017 and 2018 respectively. If you have household and any other full-time or part-time employees, you must include the FUTA taxes for your household employees on Form 940.

When must you file Form 940?

The due date for Form 940 is January 31 every year for the preceding tax year.

How do I pay FUTA tax?

You must pay your FUTA tax deposit using EFT via the United States Department of Treasury website at EFTPS.gov. Be sure to submit your deposit by 8 P.M. Eastern Time the day before the deposit due date.

Where can I find Form 940 tax form in a printable format?

You can find Form 940 on the IRS website.