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Fill in a Valid IRS 940 Form

The IRS 940 form is an annual tax form used by employers to report their Federal Unemployment Tax Act (FUTA) liabilities. This form helps the IRS track the taxes that employers owe for unemployment benefits. Understanding how to complete and file the 940 form is essential for maintaining compliance and avoiding penalties.

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Document Sample

	Form 940for 2020: Employer’s Annual Federal Unemployment (FUTA) Tax Return	850113
		OMB No. 1545-0028
	Department of the Treasury — Internal Revenue Service	OMB No. 1545-0028

Employer identification number

—

(EIN)

Name (not your trade name)

Trade name (if any)

Address

Number	Street			Suite or room number


City			State	ZIP code


Foreign country name		Foreign province/county		Foreign postal code

Type of Return

(Check all that apply.)

a. Amended

b. Successor employer

c. No payments to employees in 2020

d. Final: Business closed or stopped paying wages

Go to www.irs.gov/Form940 for instructions and the latest information.

Read the separate instructions before you complete this form. Please type or print within the boxes.

Part 1: Tell us about your return. If any line does NOT apply, leave it blank. See instructions before completing Part 1.

1a	If you had to pay state unemployment tax in one state only, enter the state abbreviation .	1a
1b	If you had to pay state unemployment tax in more than one state, you are a multi-state
	employer	1b
2	If you paid wages in a state that is subject to CREDIT REDUCTION	2
2		2

Check here.

Complete Schedule A (Form 940).

Check here.

Complete Schedule A (Form 940).

Part 2: Determine your FUTA tax before adjustments. If any line does NOT apply, leave it blank.

3	Total payments to all employees							.	3				.
4	Payments exempt from FUTA tax				4		.

	Check all that apply: 4a			Fringe benefits	4c	Retirement/Pension		4e		Other
		4b		Group-term life insurance	4d	Dependent care
		4b		Group-term life insurance	4d	Dependent care
5	Total of payments made to each employee in excess of
5	Total of payments made to each employee in excess of						.
	$7,000				5		.
6	Subtotal (line 4 + line 5 = line 6)							.	6				.

7	Total taxable FUTA wages (line 3 – line 6 = line 7). See instructions							.	7				.

8	FUTA tax before adjustments (line 7 x 0.006 = line 8)							.	8				.

Part 3:		Determine your adjustments. If any line does NOT apply, leave it blank.
9	If ALL of the taxable FUTA wages you paid were excluded from state unemployment tax,
9													.
	multiply line 7 by 0.054		(line 7 × 0.054 = line 9). Go to line 12					.	9				.
10	If SOME of the taxable FUTA wages you paid were excluded from state unemployment tax,
	OR you paid ANY state unemployment tax late (after the due date for filing Form 940),												.
	complete the worksheet in the instructions. Enter the amount from line 7 of the worksheet .							.	10				.

11	If credit reduction applies, enter the total from Schedule A (Form 940)							.	11				.

Part 4:		Determine your FUTA tax and balance due or overpayment. If any line does NOT apply, leave it blank.

12	Total FUTA tax after adjustments (lines 8 + 9 + 10 + 11 = line 12)							.	12				.

13	FUTA tax deposited for the year, including any overpayment applied from a prior year							.	13				.
14	Balance due. If line 12 is more than line 13, enter the excess on line 14.
	• If line 14 is more than $500, you must deposit your tax.
	• If line 14 is more than $500, you must deposit your tax.								14				.
	•	If line 14 is $500 or less, you may pay with this return. See instructions						.	14				.

15	Overpayment. If line 13 is more than line 12, enter the excess on line 15 and check a box below								15				.
		You MUST complete both pages of this form and SIGN it.				Check one:		Apply to next return.			Send a refund.



												Next N

For Privacy Act and Paperwork Reduction Act Notice, see the back of the Payment Voucher.								Cat. No. 11234O			Form	940 (2020)

850212

Name (not your trade name)

Employer identification number (EIN)

Part 5: Report your FUTA tax liability by quarter only if line 12 is more than $500. If not, go to Part 6.

16Report the amount of your FUTA tax liability for each quarter; do NOT enter the amount you deposited. If you had no liability for a quarter, leave the line blank.

16a	1st quarter (January 1 – March 31) . .	. .	.	.	.	.	.	16a
16b	2nd quarter (April 1 – June 30) . . .	. .	.	.	.	.	.	16b
16c	3rd quarter (July 1 – September 30) .	. .	.	.	.	.	.	16c
16d	4th quarter (October 1 – December 31)	. .	.	.	.	.	.	16d

17 Total tax liability for the year (lines 16a + 16b + 16c + 16d = line 17) 17

Total must equal line 12.

Part 6: May we speak with your third-party designee?

Do you want to allow an employee, a paid tax preparer, or another person to discuss this return with the IRS? See the instructions for details.

Yes. Designee’s name and phone number

Select a 5-digit personal identification number (PIN) to use when talking to the IRS.

No.

Part 7: Sign here. You MUST complete both pages of this form and SIGN it.

Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete, and that no part of any payment made to a state unemployment fund claimed as a credit was, or is to be, deducted from the payments made to employees. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

Sign your name here

Date

/ /

Print your name here

Print your title here

Best daytime phone

Paid Preparer Use Only

Preparer’s name

Preparer’s signature

Firm’s name (or yours if self-employed)

Address

City

Check if you are self-employed

	PTIN

	Date	/	/
	EIN
	EIN
	Phone
	Phone
State	ZIP code
State	ZIP code

Page 2

Form 940 (2020)

Form 940-V, Payment Voucher

Purpose of Form

Complete Form 940-V if you’re making a payment with Form 940. We will use the completed voucher to credit your payment more promptly and accurately, and to improve our service to you.

Making Payments With Form 940

To avoid a penalty, make your payment with your 2020 Form 940 only if your FUTA tax for the fourth quarter (plus any undeposited amounts from earlier quarters) is $500 or less. If your total FUTA tax after adjustments (Form 940, line 12) is more than $500, you must make deposits by electronic funds transfer. See When Must You Deposit Your FUTA Tax? in the Instructions for Form

940.Also see sections 11 and 14 of Pub. 15 for more information about deposits.

Use Form 940-V when making any payment with F! Form 940. However, if you pay an amount with CAUTION Form 940 that should’ve been deposited, you

may be subject to a penalty. See Deposit Penalties in section 11 of Pub. 15.

Specific Instructions

Box 1—Employer identification number (EIN). If you don’t have an EIN, you may apply for one online by visiting the IRS website at www.irs.gov/EIN. You may also apply for an EIN by faxing or mailing Form SS-4 to the IRS. If you haven’t received your EIN by the due date of Form 940, write “Applied For” and the date you applied in this entry space.

Box 2—Amount paid. Enter the amount paid with Form 940.

Box 3—Name and address. Enter your name and address as shown on Form 940.

•Enclose your check or money order made payable to “United States Treasury.” Be sure to enter your EIN, “Form 940,” and “2020” on your check or money order. Don’t send cash. Don’t staple Form 940-V or your payment to Form 940 (or to each other).

•Detach Form 940-V and send it with your payment and Form 940 to the address provided in the Instructions for Form 940.

Note: You must also complete the entity information above Part 1 on Form 940.

	Detach Here and Mail With Your Payment and Form 940.
	Detach Here and Mail With Your Payment and Form 940.
Form 940-V		Payment Voucher		OMB No. 1545-0028
Form 940-V		Payment Voucher


Department of the Treasury		Don’t staple or attach this voucher to your payment.		2020
Internal Revenue Service		Don’t staple or attach this voucher to your payment.		2020
1 Enter your employer identification number (EIN).		2	Dollars		Cents
		Enter the amount of your payment.
		Make your check or money order payable to “United States Treasury”

3Enter your business name (individual name if sole proprietor).

Enter your address.

Enter your city, state, and ZIP code; or your city, foreign country name, foreign province/county, and foreign postal code.

Form 940 (2020)

Privacy Act and Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. We need it to figure and collect the right amount of tax. Chapter 23, Federal Unemployment Tax Act, of Subtitle C, Employment Taxes, of the Internal Revenue Code imposes a tax on employers with respect to employees. This form is used to determine the amount of the tax that you owe. Section 6011 requires you to provide the requested information if you are liable for FUTA tax under section 3301. Section 6109 requires you to provide your identification number. If you fail to provide this information in a timely manner or provide a false or fraudulent form, you may be subject to penalties.

You’re not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books and records relating to a form or instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law.

Generally, tax returns and return information are confidential, as required by section 6103. However, section 6103 allows or requires the IRS to disclose or give the information shown on your tax return to others as described in the Code. For example, we may disclose

your tax information to the Department of Justice for civil and criminal litigation, and to cities, states, the District of Columbia, and U.S. commonwealths and possessions to administer their tax laws. We may also disclose this information to other countries under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism.

The time needed to complete and file this form will vary depending on individual circumstances. The estimated average time is:

Recordkeeping	9 hr., 19 min.
Learning about the law or the form . .	1 hr., 23 min.
Preparing, copying, assembling, and
sending the form to the IRS	1 hr., 36 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making Form 940 simpler, we would be happy to hear from you. You can send us comments from www.irs.gov/FormComments. Or you can send your comments to Internal Revenue Service, Tax Forms and Publications Division, 1111 Constitution Ave. NW,

IR-6526, Washington, DC 20224. Don’t send Form 940 to this address. Instead, see Where Do You File? in the Instructions for Form 940.

Document Information

Fact Name	Description
Purpose	The IRS 940 form is used to report annual Federal Unemployment Tax Act (FUTA) taxes. Employers file this form to report their unemployment tax liability for the year.
Filing Deadline	The form must be filed by January 31 of the following year. If you deposited all FUTA tax when due, you have until February 10 to file.
Who Must File	Employers who pay wages of $1,500 or more in any calendar quarter or have one or more employees for at least part of a day in 20 or more weeks must file this form.
State-Specific Forms	In addition to the IRS 940, employers may need to file state unemployment tax forms. Each state has its own governing laws, such as the California Unemployment Insurance Code.
Penalties	Failure to file the IRS 940 form on time can result in penalties. The penalty for late filing is typically 5% of the unpaid tax for each month the return is late, up to a maximum of 25%.

IRS 940 - Usage Guidelines

Filling out the IRS 940 form is an important task for employers who need to report their federal unemployment tax obligations. After completing the form, it is necessary to review the information for accuracy and submit it by the deadline. Follow these steps to ensure that you fill out the form correctly.

Obtain the IRS 940 form. You can download it from the IRS website or request a paper copy.
Enter your business name, address, and Employer Identification Number (EIN) at the top of the form.
Indicate the tax year for which you are filing the form in the appropriate box.
Complete Part 1 by reporting the total payments you made to employees during the year.
Fill out Part 2, which involves calculating your taxable wages and determining your tax liability.
In Part 3, report any adjustments for the year, if applicable.
Complete Part 4 by indicating whether you are eligible for any credits or reductions.
Sign and date the form at the bottom. Ensure that the signature is from an authorized person within the organization.
Make a copy of the completed form for your records.
Submit the form to the IRS by the specified deadline, either electronically or by mail.

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Dos and Don'ts

When it comes to filling out the IRS 940 form, attention to detail is crucial. This form is used to report your annual Federal Unemployment Tax Act (FUTA) tax. To help you navigate the process, here are some important dos and don’ts.

Do ensure you have accurate payroll records. Double-check your figures before entering them on the form.
Do file the form on time. Meeting the deadline helps you avoid penalties and interest.
Do include all required information. Missing details can lead to delays or rejections.
Do use the most current version of the form. Tax laws can change, and using outdated forms may result in errors.
Don't forget to sign the form. An unsigned form is considered invalid and will not be processed.
Don't ignore instructions. Each section of the form has specific guidelines that must be followed.

By following these guidelines, you can help ensure that your IRS 940 form is completed correctly and submitted on time. This proactive approach can save you from potential headaches down the road.

Common mistakes

Incorrect Employer Identification Number (EIN): Many individuals fail to enter the correct EIN. This number is crucial for identifying the employer and ensuring that the payment is applied to the right account.
Inaccurate Payroll Tax Calculation: Errors often occur in calculating the total payroll taxes owed. It is essential to accurately sum the taxable wages and apply the correct tax rate to avoid underpayment or overpayment.
Failure to Report All Employees: Some filers neglect to include all employees who were paid during the year. This oversight can lead to discrepancies in reported wages and tax liabilities.
Missing Signatures or Dates: Submitting the form without the necessary signatures or dates can result in processing delays. Each form must be properly signed and dated to be considered valid.

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