Do I have to pay federal unemployment tax?

Employer

Employers that paid wages of 1,500 dollars or more in any calendar quarter, or had an employee in 20 or more weeks, in the current or preceding year.

Yes, the employer pays FUTA on the first 7,000 dollars of each employee's wages; it is not withheld from pay.

File Form 940 annually and deposit FUTA tax when the accumulated liability exceeds 500 dollars.

not_in_register

1. Test the wage and 20-week thresholds
2. Compute FUTA on wages up to 7,000 dollars per employee
3. Deposit quarterly when liability exceeds 500 dollars
4. File Form 940

Form 940 by January 31 of the following year; deposits by the last day of the month after the quarter.

• 26 U.S.C. 3301
• 26 U.S.C. 3306(a)-(b)
• 26 CFR 31.6302(c)-3

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