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Department of the Treasury

Internal Revenue Service

Instructions for

Form 940-EZ

Employer’s Annual Federal Unemployment

(FUTA) Tax Return

Section references are to the Internal Revenue Code unless otherwise noted.

Items To Note

General Instructions

Electronic deposit requirement. You may be required

Who May Use Form 940-EZ

to deposit Federal taxes, such as employment tax, excise

tax, and corporate income tax, using the Electronic

Federal Tax Payment System (EFTPS). See Electronic

The following chart will lead you to the right form

deposit requirement on page 3.

to use—

FUTA rate. The (net) FUTA rate of .8% (FUTA tax rate

of 6.2% less state credit of 5.4%) is shown as .008 on

Did you pay unemployment

line 6 of Form 940-EZ. If you qualify to file Form 940-EZ,

contributions to only one

you are entitled to the full 5.4% state credit regardless of

state?*

your actual experience rate.

Signature on Form 940-EZ. Only an authorized

Yes

individual may sign Form 940-EZ. See Signature on

page 5.

Did you pay all state

State unemployment information. You must contact

unemployment contributions

your state unemployment tax office to receive your state

by January 31, 2003?**

reporting number, state experience rate, and details

about your state unemployment tax obligations.

Yes

Photographs of Missing Children

The Internal Revenue Service is a proud partner with the

Were all wages that were

National Center for Missing and Exploited Children.

taxable for FUTA tax also

Photographs of missing children selected by the Center

taxable for your state’s

may appear in instructions on pages that would otherwise

unemployment tax?

be blank. You can help bring these children home by

looking at the photographs and calling 1-800-THE-LOST

Yes

(1-800-843-5678) if you recognize a child.

Purpose of Form

You may use

You must use

Form 940-EZ.

Form 940.

Use Form 940-EZ (or Form 940) to report your annual

Federal Unemployment Tax Act (FUTA) tax. FUTA tax,

together with state unemployment systems, provides for

payments of unemployment compensation to workers

*Do not file Form 940-EZ if —

who have lost their jobs. Most employers pay both

•

You owe FUTA tax only for household work in a private

Federal and state unemployment taxes. Only the

home. See Household employers on page 2.

employer pays this tax. Do not collect or deduct it from

•

You are a successor employer claiming a credit for

your employees’ wages. The tax applies to the first

state unemployment contributions paid by a prior

$7,000 you pay each employee in a year after subtracting

employer. File Form 940.

any exempt payments. The $7,000 amount is the Federal

**If you deposited all FUTA tax when due, you may

wage base. Your state wage base may be different.

answer “Yes” if you paid all state unemployment

contributions by February 10, 2003.

When To File

You can get Form 940 and the Instructions for Form

File Form 940-EZ for 2002 by January 31, 2003.

940 by calling the IRS at 1-800-TAX-FORM

However, if you deposited all FUTA tax when due, you

(1-800-829-3676) or by visiting the IRS Web Site at

may file on or before February 10, 2003. Your return will

be considered timely filed if it is properly addressed and

mailed First Class or sent by an IRS designated delivery

service by the due date. See Circular E, Employer’s Tax

Guide (Pub. 15), for a list of designated delivery services.

Also see Where To File on page 2.

Cat. No. 25947I

Instructions For Form 940-Ez - Employer'S Annual Federal Unemployment (Futa) Tax Return - Internal Revenue Service - 2002

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