2025›Instructions for Form 940›General Instructions
What’s the Purpose of Form 940?
Instruction 940 — Instructions for Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return · 2026-10-03 edition · updated 2026-10-04 · United States
These instructions tell you who must file the form, how to fill it out line by line, and when and where to file it.
Use Form 940 to report your annual Federal Unemployment Tax Act (FUTA) tax. Together with state unemployment tax systems, the FUTA tax provides funds for paying unemployment compensation to workers who have lost their jobs. Most employers pay both a federal and a state unemployment tax. Only employers pay FUTA tax. Don’t collect or deduct FUTA tax from your employees’ wages.
The FUTA tax applies to the first $7,000 you pay to each employee during a calendar year after subtracting any payments exempt from FUTA tax.
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