Form 940 vs. Form 941

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.

Don’t confuse Form 940, which is an annual employer return for unemployment tax purposes, with other employer returns, such as:

Form 941, Employer’s Quarterly Federal Tax Return, which is used to report wage withholding for income taxes as well as the employees’ share of Social Security and Medicare (FICA) taxes, plus the employer’s share of FICA.

Form 943, Employer’s Annual Federal Tax Return for Agricultural Employees, is used instead of Form 941 to report once a year the amount of withheld federal income and FICA taxes (the employee and employer share).

Form 944, Employer’s Annual Federal Tax Return, which is filed instead of the quarterly employer returns if the employer is “small.” This applies to employers with annual tax liability withheld federal income tax, FICA (employee and employer share) totaling $1,000 or less.