Definition and Purpose of Form 940
Form 940, known as the Employer's Annual Federal Unemployment (FUTA) Tax Return, is used by employers in the United States to report and calculate their Federal Unemployment Tax Act (FUTA) liability. The primary purpose of this form is to report federal unemployment taxes, which fund unemployment benefits provided by the state to eligible employees. Employers are required to file this form if they paid wages of $1,500 or more in any quarter of the previous or current year or if they had one or more employees working at least part of a day in 20 different weeks. FUTA tax is separate from state unemployment taxes, providing a safety net for workers who lose their jobs.
How to Use the Fillable 2014 Form 940
The fillable version of the 2014 Form 940 allows employers to type their information directly into the form, ensuring accuracy and legibility before print or electronic submission. Users can fill out the form by entering their employer identification number (EIN), business name, and address at the top of the form. It is crucial to accurately complete each line to reflect total payments to employees, total FUTA taxable wages, and any adjustments needed for state unemployment tax credits. Utilizing a fillable form reduces errors that may occur with handwritten entries and facilitates easier integration into electronic filing systems.
Steps to Complete the Fillable 2014 Form 940
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Enter Business Information:
- Include your EIN, legal business name, and business address.
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Calculate FUTA Wages:
- Report total payments to all employees, deduct non-taxable payments and exemptions, then calculate FUTA taxable wages.
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Determine Adjustments:
- Account for any credits against your FUTA tax resulting from timely payments to state unemployment funds.
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Calculate Final Tax Liability:
- Use the provided calculations to determine your total FUTA tax liability after applicable adjustments and credits.
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Review and Sign:
- Ensure all entries are correct, then sign and date the form to certify its accuracy.
Key Elements of the Fillable 2014 Form 940
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Employer Information:
- Contains fields for EIN, business name, and address to identify the reporting entity.
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Taxable Wage Calculation:
- Sections to calculate total FUTA wages, accounting for allowable deductions.
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State Tax Credit:
- Allows input for state unemployment contributions to reduce federal liability.
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Final Tax Calculation:
- Details the computation of taxes owed, credits applied, and balance due.
Filing Deadlines and Important Dates
The 2014 Form 940 is due by January 31, 2015. If you have deposited all your FUTA tax when due, you have until February 10, 2015, to file. Missing these deadlines may result in penalties and interest. It’s crucial to prepare the form accurately and file it on time to avoid non-compliance repercussions.
Form Submission Methods
Employers can submit their completed 2014 Form 940 through several channels. The IRS accepts either paper forms sent via mail or electronic submissions through authorized e-file providers. Electronic filing is encouraged as it speeds processing and reduces errors. To e-file, you might utilize platforms compatible with IRS guidelines, such as TurboTax or QuickBooks.
Penalties for Non-Compliance
Failing to file or inaccurately completing the 2014 Form 940 could lead to several penalties, including a failure-to-file penalty of 5% of the unpaid tax per month. Similarly, late payments result in a penalty that also accrues monthly. It is important to provide accurate and timely filings to avoid unnecessary fines.
IRS Guidelines on Form 940
The IRS provides detailed instructions accompanying Form 940, specifying rules for calculating FUTA taxes, applicable credits, and wage reductions. Adhering to these guidelines is crucial for compliance and ensuring that the correct tax is paid. Employers should thoroughly review these instructions to help accurately complete the form.
