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Form 940 Deadline 2026: Key Dates And Filing Tips

Form 940 is the annual FUTA return that pulls together all four quarters of your federal unemployment tax. For 2025 wages reported in 2026, the return is generally due on February 2, 2026, with a February 10, 2026, grace date only if every FUTA deposit was made in full and on time. This guide walks through how those deadlines tie into the quarterly deposit schedule, how the $500 rule works in practice, and what employers should review before filing to keep FUTA reporting accurate and penalty-free.

What Form 940 Does And Why The Deadlines Matter

Form 940 reports an employer’s Federal Unemployment Tax Act liability for the prior calendar year. FUTA applies at 6% on the first $7,000 of each employee’s wages, and timely state unemployment tax payments usually reduce this to an effective 0.6%.

An employer must file Form 940 if:

  • $1,500 or more in wages were paid in a calendar quarter during the current or the previous calendar year; or
  • At least one employee worked for at least some part of a day in 20 or more different weeks during the current or preceding calendar year.

Even when the SUTA credit reduces FUTA liability to zero, Form 940 must still be filed to report annual unemployment tax information.

Deadlines matter because:

  • Filing late triggers a 5% penalty per month on unpaid FUTA, up to 25%.
  • FUTA deposits made late get hit with penalties that grow as the delay gets longer.
  • Late payment of state unemployment tax can shrink the FUTA credit and raise the tax.
  • Errors and mismatches increase audit risk.
  • Cash flow planning gets thrown off when deposits are forgotten or pushed aside.

Form 940 Deadline For 2026 And How The Grace Period Works

The filing deadline for the 2025 Form 940 is February 2, 2026. January 31 is normally the due date, but it falls on a weekend, so it is forwarded to the next business day.

The IRS provides a 10-day grace period only when all required FUTA deposits are made on time. Since no deposits are required when annual FUTA liability is $500 or less, employers in this situation can follow the

regular filing deadline unless the IRS issues some other specific guidance. If even a single payment was late or short, the return must be filed by February 2, and the grace period will not be applicable anymore.

Both paper and e-file use the same deadline. E-filing is strongly recommended, mostly because it saves employers a lot of time. If a business closes or is sold, then you still have to submit a final Form 940 after the last wages are issued and check the box for a final return.

FUTA Deposit Calendar For 2026 And The $500 Accumulation Rule

FUTA doesn’t run on a predictable monthly deposit schedule. The IRS applies the $500 rule, which requires employers to monitor cumulative FUTA liability throughout the year to determine when deposits are due.

Here is the FUTA deposit schedule for 2025 liability reported in 2026:

Quarter-End Deposit Due Notes
March 31 April 30 Deposits must be made electronically
June 30 July 31 Standard deadline
September 30 October 31 Standard deadline
December 31 February 2, 2026 If the balance of undeposited FUTA at the end of Q4 is $500 or less, you may pay it with your Form 940 instead of depositing.
However, once cumulative liability exceeds $500 during the year, a deposit is required.

How the $500 rule works:

  • FUTA is tracked cumulatively from Q1 forward.
  • If the total stays at or under $500 through Q3, nothing is deposited yet.
  • When the total exceeds $500, the entire amount is due by the next quarterly deadline.
  • If the year ends at $500 or less, that amount may be paid with the Form 940 return instead of being deposited separately.

As an employer, you need to review your cumulative FUTA liability at the end of each quarter to determine whether a deposit is required under the $500 rule. If your cumulative FUTA tax for the quarter (including any amount carried forward) is more than $500, the deposit is due by the end of the month following the quarter end. If it is $500 or less, the amount carries forward to the next quarter.

FUTA deposits must be made electronically through an IRS-approved method such as EFTPS. If you miss the EFTPS cutoff time, you can still make a same-day wire transfer through the Federal Tax Collection Service to keep the payment on time. The $100,000 next-day deposit rule that applies to federal income tax and FICA deposits does not apply to FUTA; FUTA deposits follow only the $500 threshold and the quarterly schedule.

Form 940 Penalties And Interest For 2026

If an employer forgets a deadline, here is what the penalty structure looks like:

Situation Penalty Rate Trigger
Late Form 940 filing 5% per month up to 25% Based on the unpaid FUTA
Deposit 1 to 5 days late 2% Amount not deposited
Deposit 6 to 15 days late 5% Same
Deposit 16 or more days late 10% Same
Not deposited within 10 days after the first IRS notice 15% Highest penalty level

Interest begins the day after a payment is due and compounds daily.

The FUTA credit also suffers when state unemployment taxes are paid late. Missing those deadlines reduces the 5.4% credit and increases the amount due on Form 940.

Special Situations That Affect Form 940 Filing

Some businesses fall into situations the IRS considers special:

Seasonal payers

Businesses like holiday shops or ski resorts often only pay wages for a few months of the year. Even so, FUTA still follows the $500 rule, and Form 940 is due February 2, 2026 (or February 10, 2026, if you deposited all FUTA tax when due).

New businesses

For new employers, FUTA deposits only begin when the cumulative liability crosses $500. Until that point, there are no deposits. Once the threshold is met, the first deposit is due by the last day of the month after the quarter.

Credit reduction states

Each November, the Department of Labor identifies states that owe federal unemployment loans. Employers in those states pay extra FUTA, but all deadlines remain exactly the same.

Mergers, acquisitions, and closures

When ownership changes, each responsible employer files their own Form 940 for the period that they had liability. Successor rules may require the new employer to count wages paid by the old employer toward the $7,000 FUTA wage base. If a business closes, the final Form 940 is still required.

A Year-Round Checklist For Staying Compliant

A simple checklist keeps FUTA from spiraling into penalty territory.

  • Track FUTA taxable wages and cumulative liability each payroll run.
  • At quarter-end, confirm whether FUTA crossed $500 and whether a deposit is due.
  • You’ll need to verify for each quarter that your state unemployment contributions have been filed and posted timely SUTA payments will preserve the full FUTA credit.
  • In January, reconcile FUTA wages with W-2 totals and state wage filings.
  • By late January, finalize all totals for Form 940 and Schedule A if needed.
  • By February 2, 2026, or February 10, 2026, e-file Form 940 and save the IRS acknowledgment.

Scenarios That Show How FUTA Rules Work In Real Life

Scenario Correct Action Deadline
FUTA liability reaches $650 in Q2 Deposit the full $650 electronically July 31
FUTA totals $420 for the year Pay with Form 940 instead of depositing February 2
All deposits were on time File using the grace period February 10
Q3 deposit paid 20 days late 10% late deposit penalty applies
A seasonal business only pays wages in winter Deposit only when cumulative FUTA exceeds $500 for a quarter still file Form 940 by the deadline February 2

FAQs

1. Is there an extension for Form 940?

No. The only relief is the February 10 grace period for perfect deposit history.

2. What if FUTA liability hits exactly $500?

If your FUTA tax for a quarter is $500 or less, you need to carry it forward to the next quarter deposit only when the cumulative amount for a quarter exceeds $500. If the fourth-quarter total is $500 or less, pay it with Form 940 by February 2, 2026.

3. Does e-filing change the Form 940 deadline?

No. Both paper filing and e-filing methods follow the same dates.

4. What if a deadline falls on a legal holiday?

It moves to the next business day.

5. Can a payer combine FUTA payments with payroll withholding in a single EFTPS deposit?

No. FUTA must be paid separately.

6. How does late SUTA payment affect FUTA?

It reduces the credit and increases FUTA tax owed, which raises the Form 940 balance.

Final Thoughts

Form 940 is a straightforward annual filing, but missing its deadlines can still lead to penalties and added compliance work. Keeping in mind the date of the 2026 filing, the $500 FUTA rule, the quarterly deposit dates, and how credit reductions work will help you maintain organized and hassle-free deposit and e-filing of the form.

Don’t leave FUTA compliance to chance. Use Tax1099 to monitor liability, schedule deposits, and e-file Form 940 before the deadline.

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