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Version: 1.7.3

Form 940 — Filing Workflow

Form 940 is used to report Federal Unemployment Tax Act (FUTA) taxes. Unlike other 94x forms, FUTA is paid entirely by the employer — no employee contribution.

Filing Frequency (Deadline)

Annual (Jan 31)

Who Files

Employers with FUTA obligations

Prerequisites

Account Setup

Before you begin filing, you must complete your account setup in the TaxBandits retail (UI) application.

  1. Log in at https://secure.taxbandits.com/login using the same credentials as your developer console
  2. Navigate to Tax Professional Information from the 9-dot menu
  3. Set the appropriate Filer Type (e.g., CPA, Reporting Agent, ERO, etc.)
  4. Provide all required details, including firm name, EIN, contact details, and IRS credentials (e.g., PTIN, EFIN, RA-PIN)

This step is required to ensure filings are processed correctly based on your filer type and signature method.

Authentication​

Before you can submit any filings, authenticate using OAuth 2.0 to obtain the Bearer Token for your API requests. This token must be included in the Authorization header for all subsequent API requests to ensure that the requests are properly authorized. Learn more about OAuth 2.0

Add Business (Client)​

Before filing, you need to add the business you'll be filing for. You can use the Business/Create endpoint to add a new business to the TaxBandits API.

Alternatively, you can provide the business details directly when creating the form.

Webhook Configuration (Optional)​

To receive real-time updates on the status of your filings, configure a webhook to handle the 'E-file Status Change (Federal)' event type. This allows you to get notified when the IRS accepts or rejects a filing, or when there are any changes to the status of your submission. Learn more about webhooks

Steps to File Form 940​

  1. Create Form 940

    Call the Form940/Create endpoint with all the required information to create 940 forms. You can create up to 250 forms in a single API call.

  2. Review and Make Necessary Changes

    Once the return is created, you can review the data and make any necessary changes using the Form940/Update endpoint. This step is optional.

  3. Complete Signature Process

    Next, you need to collect client signatures and add your own as the preparer. You can use the applicable signature type based on the type of filer you are.

    • CPAs and Paid Preparers: Once your 940 is created, TaxBandits will automatically generate Form 8453-EMP based on the return information. You can retrieve this form, obtain the client's signature, and add the preparer's signature either manually or electronically. See how

    • EROs (Electronic Return Originators): Once your 940 is created, TaxBandits will automatically generate Form 8879-EMP based on the return information. You can retrieve this form, obtain the client's signature, add the preparer's signature, and keep it for your records.

    • Software Providers: Once your 940 is created, TaxBandits will automatically generate Form 8453-EMP based on the return information. You can retrieve this form, obtain the client's signature, and add the preparer's signature either manually or electronically. See how

  4. Transmit the Return to IRS

    Once the form is signed, submit it to the IRS via the Form940/Transmit endpoint.

  5. Track Status

    After submitting the return, monitor its status using the Status endpoint or receive automated notifications via webhooks (if configured).

  6. Rejection Handling

    If the IRS rejects your 940 forms, you can fix the errors using the Update endpoint and retransmit using the Transmit endpoint.

FUTA Deposit Rules​

Although Form 940 is an annual return, FUTA deposits are due quarterly when the liability threshold is met.

  • Cumulative FUTA liability exceeds $500.
  • If liability is $500 or less at the end of the year, pay with return by Jan 31.
QuarterDue Date
Q1 (Jan-Mar)April 30
Q2 (Apr-Jun)July 31
Q3 (Jul-Sep)October 31
Q4 (Oct-Dec)January 31 (with return)