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You were required to use EFTPS in 2003.

paying FUTA wages again, file Form 940-EZ (or Form

If you are required to use EFTPS and use Form 8109

940).

instead, you may be subject to a 10% penalty. If you are

Part I. Taxable Wages

not required to use EFTPS, you may participate

voluntarily. To enroll in or get more information about

and FUTA Tax

EFTPS, call 1-800-555-4477 or 1-800-945-8400; or to

enroll online, visit the EFTPS website at

Line 1 — Total payments. Enter the total payments

(before any deductions) you made during the calendar

For deposits made by EFTPS to be on time, you

year for services of employees, even if the payments are

must initiate the transaction at least one business

not taxable for FUTA tax. Include salaries, wages,

day before the date the deposit is due.

CAUTION

commissions, fees, bonuses, vacation allowances, and

amounts paid to temporary or part-time employees; the

Not Liable for FUTA Tax?

value of goods, lodging, food, clothing, and noncash

fringe benefits; contributions to a 401(k) plan, payments

If you receive Form 940-EZ and are not liable for FUTA

to an Archer MSA, payments under adoption assistance

tax for 2003, write “Not Liable” across the front of the

programs, and contributions to SIMPLE retirement

form, sign the form, and return it to the IRS.

accounts (including elective salary reduction

Penalties and Interest

contributions); section 125 (cafeteria) plan benefits; and

sick pay (including third-party sick pay if liability is

Avoid penalties and interest by making tax deposits when

transferred to the employer).

due, filing a correct return, and paying all taxes when

For details on sick pay, see Pub. 15-A, Employer’s

due. There are penalties for late deposits, insufficient

Supplemental Tax Guide. Report amounts deferred

deposits, failure to deposit using EFTPS (when required),

under a nonqualified deferred compensation plan at the

and late filing unless you can show reasonable cause. If

later of: (a) when services are performed or (b) when

you file late, attach an explanation to the return. There

there is no substantial risk of forfeiture of the rights to the

are also penalties for willful failure to pay tax, make

deferred amount. For details, see Regulations section

returns, and for filing false or fraudulent returns.

31.3306(r)(2)-1. Also, include tips of $20 or more in a

month reported to you by your employees.

How To Get Forms and Publications

Your method of payment does not determine whether

You can get most IRS forms and publications by

payments are wages. Thus, you may pay wages hourly,

accessing the IRS website at or by calling

daily, weekly, monthly, or yearly. You may pay wages for

the IRS at 1-800-TAX-FORM (1-800-829-3676). See the

piecework or as a percentage of profits. You may pay

Instructions for Forms W-2 and W-3 for details and

wages in cash or some other way, such as goods,

other options.

lodging, food, or clothing. For items other than cash, use

their fair market value when paid.

Line 2 — Exempt payments. The amounts reported on

Specific Instructions

line 2 are exempt from FUTA tax. For FUTA tax

You must complete lines A and B and Part I. If your

purposes, “wages” and “employment” do not include

FUTA tax (line 6) is over $100, you must also complete

every payment and every kind of service an employee

Part II. Please remember to sign the return.

may perform. In general, payments excluded from wages

and payments for services excepted from employment

Employer’s name, address, calendar year, and

are not subject to FUTA tax. Do not enter payments

employer identification number (EIN). If you are not

over $7,000 for each employee that you enter on

using a preaddressed Form 940-EZ, type or print your

line 3.

name, trade name, address, calendar tax year, and EIN

on the form. Enter your name, address, calendar tax

You may deduct exempt payments from total

year, and EIN here, even if you must complete Form

payments only if you explain them on line 2. Amounts

940-EZ(V), Payment Voucher.

that may be exempt from your state’s unemployment tax

may not be exempt from FUTA tax. For example,

Employer identification number (EIN). If you do not

corporate officers’ wages are not exempt from FUTA

have an EIN, apply for one on Form SS-4, Application for

tax even though your state may exempt those wages

Employer Identification Number, or by visiting the IRS

from its unemployment tax.

website at /smallbiz. If you do not have an

EIN by the time your return is due, write “Applied For”

Enter payments such as the following on line 2.

and the date you applied in the space shown for the

These payments also must be entered on line 1.

number.

1. Agricultural labor if you did not meet either 1 or 2

Line A. Enter the amount of your state unemployment

under Agricultural employers on page 2 and all

contributions for 2003 that you paid by February 2, 2004

payments to “H-2(A)” visa workers.

(or February 10, 2004, if that is your Form 940-EZ due

2. Benefit payments for sickness or injury under a

date). If your state has given you a zero percent

workers’ compensation law.

experience rate so there are no required contributions,

3. Household service if you did not pay total cash

enter “0% Rate.”

wages of $1,000 or more in any calendar quarter in 2002

or 2003.

Line B(1). Enter the state where you paid state

4. Certain family employment. (See section 3 in

unemployment contributions. If you paid to more than

Circular E (Pub.15).)

one state, you must file Form 940.

5. Certain fishing activities. (See Pub. 595, Tax

Line B(2). Enter your state reporting number.

Highlights for Commercial Fishermen.)

Final return. If you will not have to file Form 940-EZ (or

6. Noncash payments for farmwork or household

Form 940) in the future, check the box on the line below

services in a private home. (Only cash wages paid to

line B(2) and complete and sign the return. If you start

these workers are taxable.)

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Instructions For Form 940-Ez - Employer'S Annual Federal Unemployment (Futa) Tax Return - Internal Revenue Service - 2003 Page 4

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