What's on Employer’s Annual Federal Unemployment (FUTA) Tax

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Use Form 940 to report your annual Federal Unemployment (FUTA) tax. The employers pay both a federal and a state
unemployment tax. Only employers pay FUTA tax. Do not deduct FUTA tax from your employees’ wages.

The FUTA tax rate will remain at 6.2% through June 30, 2011. The tax rate is scheduled to decrease from 6.2% to 6.0% beginning July 1, 2011. Visit IRS.gov for updated information.

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The due date for filing Form 940 for 2010 is January 31.