When Is Form 940 Payment Due for Employers?
Navigate employer FUTA tax obligations with our guide. Understand Form 940 payment due dates and how to ensure timely compliance.
Employers play a significant role in funding unemployment compensation for workers who have lost their jobs. Form 940, the Employer’s Annual Federal Unemployment (FUTA) Tax Return, serves as the primary document for reporting and reconciling this federal tax obligation. Ensuring timely payments is important for employers to maintain compliance with federal tax regulations.
Understanding FUTA Tax and Form 940 Payments
Federal Unemployment Tax (FUTA) is a federal tax levied on employers, with its proceeds contributing to state unemployment benefit programs. This tax helps provide financial assistance to eligible individuals experiencing job loss. Employers are generally required to pay FUTA tax if they paid wages of $1,500 or more to employees in any calendar quarter during the current or preceding year. Alternatively, the requirement applies if they had at least one employee for some part of a day in any 20 different weeks within a calendar year. Form 940 reports and reconciles the total FUTA tax liability for a calendar year.
Annual Form 940 Filing and Payment Due Dates
The annual Form 940 return, which covers the FUTA tax liability for a given calendar year, is generally due by January 31st of the following year. For instance, the Form 940 for the 2024 tax year would be due on January 31, 2025. If an employer has deposited all their FUTA tax payments on time throughout the year, the due date for filing Form 940 is extended to February 10th. This extension applies to the submission of the annual return and any final remaining FUTA tax payment for the year.
Quarterly FUTA Tax Deposit Requirements
FUTA tax liabilities are typically deposited quarterly, though Form 940 is an annual return. Employers must deposit if their FUTA tax liability exceeds $500 at quarter-end.
If $500 or less, liability carries over to the next quarter until it surpasses $500. Once met, the entire amount must be deposited by the last day of the month following the quarter.
Quarterly deposit due dates are April 30th (Q1), July 31st (Q2), and October 31st (Q3). The Q4 deposit, including any undeposited amounts, is due by January 31st of the following year. These are deposit deadlines, transferring funds to the IRS, not filing dates for Form 940. Quarterly deposits reduce the final payment due when the annual Form 940 is filed.
How to Make FUTA Tax Payments
The Electronic Federal Tax Payment System (EFTPS) is the primary and often required method for making FUTA tax deposits. Employers must enroll in EFTPS, which can take several business days to process. Once enrolled, payments can be scheduled up to 365 days in advance and made 24/7. To initiate a payment, employers typically need their Employer Identification Number (EIN), a PIN, and an internet password. If the FUTA tax liability for the fourth quarter (plus any undeposited amounts) is $500 or less, employers may pay the tax with their Form 940 by January 31st. The IRS encourages electronic payments, so checks or money orders should generally be avoided.