IRS Tax Form 940 Instructions for 2011, 2012

Form 940 is used to report your annual Federal Unemployment Tax Act (FUTA) tax. The purpose of the FUTA tax is to provide funds for paying unemployment compensation to workers who have lost their jobs. Employers pay FUTA tax and do not deduct this tax from their employee’s wages.

Find a printable tax form 940 here.

Do I Have to File Form 940?

You may be wondering if you have to file this tax form or not.

If you answer yes to these questions, then you have to file tax Form 940.

1. In a calendar quarter, did you pay wages of $1,500 or more to employees?

2. During 20 or more different weeks, did you have one or more employees working for you at least some part of the day?

Different Situations For Filing IRS Tax Form 940

The rules change for different situations and different types of employees.

Here is a list of special considerations you will have to look into for more information.

• Household employees in a private home, local college, fraternity or sorority
• Cash wages paid to farm workers
• Indian tribal governments
• Tax-exempt organizations
• Employers of state and local government employees

When should you deposit your FUTA tax?

Even though tax Form 940 covers a calendar year, you may have to deposit your FUTA tax before you file your income tax return. You are going to have to deposit at least one quarterly payment if, your FUTA tax is more than $500 for the year. Make sure you pay your tax when it’s due and file your completed tax Form 940 with accuracy and make sure it’s sent in on time.

Professional Tax Advice and Instructions For IRS Tax Form 940

If you would like help filing the correct 940 tax forms, then I would suggest an online service like, Quickbooks Online Payroll. They offer so many services you just can’t go wrong using them.

You will be able to calculate your employees paychecks instantly. Federal & States withholding taxes are calculated for you, then pay employees with our free direct deposit, or print checks & stubs on your own printer, directly from the Quickbooks online system.