Send Form 940 payments to the IRS, not your state
Form 940 payments go to the Internal Revenue Service (IRS), not to your state unemployment office. The IRS collects federal unemployment tax (FUTA) centrally, even though states administer their own unemployment insurance programs. You have three ways to send the payment: by mail to an IRS lockbox, electronically through the Electronic Federal Tax Payment System (EFTPS), or through your tax software or tax professional.
The method you choose depends on how you file your return and how much you prefer to handle payments yourself. Electronic payment is faster and gives you immediate confirmation, while mailing a check works if you prefer paper records. Either way, the IRS processes the payment the same way once it arrives.
Key Takeaways
- Form 940 payments go to an IRS lockbox address that varies by region, not to your state unemployment office.
- Electronic Federal Tax Payment System (EFTPS) is the fastest method and provides immediate confirmation of payment receipt.
- If you mail a check, include the Form 940-V payment voucher with your payment so the IRS can match it to your account.
- The payment deadline is typically January 31 of the year following the tax year, though extensions may shift this date.
- You can track electronic payments through EFTPS or your tax software, but mailed checks take 7 to 10 business days to clear.
Mailing a check to the correct IRS lockbox
If you pay by mail, you must send your check to the correct regional lockbox address. The IRS maintains separate lockboxes for different states and payment types. Your Form 940 payment goes to a specific lockbox based on your state of business location, not your personal state of residence.
Find the correct address on the Form 940-V payment voucher, which you print when you complete your Form 940. The voucher shows the lockbox address for your region and includes a tear-off section with your tax identification number and payment amount. Attach the voucher to your check (do not staple it), and mail both together. The IRS uses the voucher to route your payment to the right account.
Mail your payment early enough to arrive by the deadline—the postal service typically takes 3 to 7 business days depending on distance. The IRS considers a payment received on the date it arrives at the lockbox, not the date you mail it. If you are close to the deadline, electronic payment is safer because it posts immediately.
Paying electronically through EFTPS
The Electronic Federal Tax Payment System (EFTPS) is the IRS's official electronic payment method for federal taxes, including Form 940. You can enroll in EFTPS online at www.eftps.gov or by calling 1-800-555-4477. Enrollment takes about 10 minutes, and you will receive a PIN by mail within two weeks. Once enrolled, you can make payments immediately.
To pay through EFTPS, log in with your employer identification number (EIN) and PIN, select the tax type (941-X for unemployment tax), enter your payment amount, and choose a payment date. You can schedule payments up to 120 days in advance. The system confirms your payment immediately and provides a confirmation number you should save for your records.
EFTPS transfers funds from your bank account on the date you specify. The payment typically clears within one business day, and the IRS receives it electronically the same day. There is no fee to use EFTPS, and it works with checking or savings accounts.
Paying through tax software or a tax professional
If you file Form 940 through tax software (such as TurboTax for Business, OnPay, or Gusto), the software usually offers to process your payment electronically. You enter your bank account information, and the software routes the payment to the IRS through its own payment processor. This method is convenient because the payment is tied directly to your return.
Tax professionals and payroll services can also submit Form 940 and handle the payment on your behalf. They typically charge a small fee (usually $15 to $50) to process the payment, but they manage the timing and confirmation. This is useful if you have a complex return or prefer to hand off the entire process.
Whether you use software or a professional, confirm that the payment method is electronic and ask for a confirmation number once the payment posts. Do not assume the payment went through just because you submitted the return—follow up to verify the IRS received it.
What happens if you pay late or to the wrong address
If your payment arrives after the deadline, the IRS assesses a failure-to-pay penalty of 0.5% of the unpaid tax per month, up to 25%. Interest also accrues on the unpaid balance at the current federal rate (which changes quarterly). The penalty applies even if you filed the return on time but paid late.
If you mail your payment to the wrong lockbox address, it may be delayed or returned to you. The IRS will not automatically forward it to the correct location. If this happens, you will receive a notice about the late payment. Contact the IRS at 1-800-829-1040 to explain the error and ask about penalty relief. The IRS sometimes waives penalties for first-time errors if you can show the payment was mailed to an incorrect address through no fault of your own.
If you realize you made an error after mailing, do not send another payment. Instead, contact the IRS and explain the situation. Sending duplicate payments creates confusion and may result in overpayment credits that take months to resolve.
Tracking your Form 940 payment status
If you paid electronically through EFTPS, you can track your payment in real time. Log back into EFTPS and view your payment history, which shows the date submitted, amount, and status (accepted, pending, or posted). The system updates within hours of submission.
If you paid through tax software or a payroll service, check your account dashboard or email confirmation. Most platforms show payment status and provide a confirmation number. Keep this number for your records in case you need to dispute the payment later.
If you mailed a check, tracking is slower. The IRS typically posts mailed payments 7 to 10 business days after receipt. You can check whether the payment posted by logging into your IRS business account at www.irs.gov/business or by calling the IRS at 1-800-829-1040. Have your EIN and the payment amount ready when you call.
If your payment does not appear in your IRS account within two weeks of mailing, contact the IRS. Provide the check number, amount, and date mailed. The IRS can search the lockbox records and confirm whether the payment was received.
Frequently Asked Questions
Can I pay Form 940 through my state unemployment office?
No. Form 940 is a federal tax, so payments go only to the IRS. Your state collects its own unemployment tax through a separate form (usually Form UC or a state-specific document). Do not send federal and state unemployment payments to the same place.
What if I cannot pay the full amount by the deadline?
Pay what you can by the deadline to minimize penalties. The IRS charges penalties on the unpaid balance, but paying something shows good faith. Contact the IRS at 1-800-829-1040 to discuss a payment plan if you owe a large amount. The IRS can set up installment agreements that spread payments over several months.
Do I need to include a Form 940-V if I pay electronically?
No. The Form 940-V voucher is only for mailed payments. Electronic payments through EFTPS or tax software do not require a voucher because the system captures your tax ID and payment information electronically.
How long does it take for the IRS to post an electronic payment?
Electronic payments typically post within one business day. EFTPS confirms receipt immediately when you submit, but the IRS may take up to one business day to update your account. If you pay on a Friday, the payment may not show in your account until Monday or Tuesday.
What if I overpaid my Form 940 tax?
The IRS will credit the overpayment to your next tax period or issue a refund if you request one. You can claim the overpayment on your next Form 940 or request a refund by contacting the IRS. Refunds typically take 4 to 6 weeks to process.