What Is Form 940 and Why Does It Matter for Trucking Companies?

Do you have employees on payroll?

Are you sure you’re handling your unemployment taxes the right way?

If your trucking company has employees, the IRS requires you to file Form 940 every year. Missing this form or filing it late can lead to costly penalties, and many small carriers don’t even know it exists until they’re already in trouble. That’s a tough way to find out.

In this article, you’ll learn exactly what Form 940 is, why it matters for trucking companies like yours, and how to stay out of trouble with the IRS. We’ll also show you how a payroll service can help make sure it all gets done right, without the stress.

What Is IRS Form 940 and Why Should Trucking Companies Care?

Form 940 is used to report your annual Federal Unemployment Tax Act (FUTA) tax. This tax goes into a federal unemployment fund, which helps cover the cost of running state unemployment programs, supports federal unemployment efforts, and provides loans to states if their unemployment funds run low.

It’s Not Just for Trucking Companies

Any business that has employees, no matter the industry, needs to file this form annually. If your trucking company has employees on payroll, you’re included.

Do You Have to File Form 940? Here’s How to Know

You must file Form 940 if either of the following happened:

You paid $1,000 or more in wages in any calendar quarter this year or last year.

You had at least one employee working any part of a day in 20 different weeks during the year.

Most employers meet one of these rules — even if they only have one or two employees.

How Much Will You Owe in FUTA Taxes?

FUTA tax is paid only by employers, not by employees. The tax rate is 6.0% on the first $7,000 of wages you pay each employee per year.

If you also pay state unemployment taxes on time and in full, the IRS usually gives you a credit of up to 5.4%, bringing your FUTA tax rate down to 0.6%. That’s a big difference, so it’s important to stay on top of your state unemployment payments, too.

What Details Does the IRS Require on Form 940?

Here’s a basic overview of what the form asks for:

Your business info — name, address, and EIN (Employer Identification Number)

Wage totals — total payments made to employees

Exempt wages — certain payments like some health benefits or retirement contributions

Taxable wages — wages that are subject to FUTA tax

Tax calculation — multiply taxable wages by the tax rate

Adjustments — credit reductions if your state owes the federal fund

Total tax due — subtract payments you’ve already made and see if you owe more or are due a refund

When Is Form 940 Due Each Year?

Form 940 is due by January 31 each year for the previous calendar year.

So, for example, your 2024 Form 940 (covering wages paid in 2024) is due by January 31, 2025.

What About Payments?

If you owe more than $500, you must make deposits throughout the year.

If you owe $500 or less, you can pay it when you file the form.

Payments must be made using the Electronic Federal Tax Payment System (EFTPS) — a free and secure way to send your payment to the IRS.

Can Trucking Companies File Form 940 Online?

Yes. The IRS allows you to file Form 940 electronically through its e-file program, and it even recommends doing so. It’s faster, easier, and helps you avoid mistakes.

5 Ways Trucking Companies Can Avoid IRS Penalties with Form 940

Missing a due date or sending the wrong payment can lead to penalties and interest. To stay out of trouble, make sure to:

File Form 940 on time.

Complete it accurately.

Pay the full amount owed.

Use EFTPS for deposits.

Keep good records of wages, tax payments, and filings.

Even small mistakes can lead to big problems later.

Why a Payroll Service Can Save You Stress (and Help You Avoid Mistakes)

If keeping up with tax forms and deadlines sounds stressful, you’re not alone. Many small businesses — including trucking companies — use a payroll service to handle this for them

At Superior Trucking Payroll Service, we take care of unemployment tax reporting, including Form 940. We track payments, file on time, and make sure everything is done right, so you don’t have to worry about it.

Final Thoughts: Keep Your Trucking Business Compliant and Penalty-Free

At this point, you should have a clear understanding of what IRS Form 940 is, who needs to file it, and how to avoid costly mistakes

If you run a trucking company and have employees on payroll, ignoring or misunderstanding Form 940 could lead to IRS penalties, payment issues, and unnecessary stress — especially if deadlines sneak up or filing details are missed.

To stay ahead, the best next step is to let a trusted payroll expert handle it for you. That way, you can focus on keeping your trucks moving without worrying about tax compliance.

At Superior Trucking Payroll Service, we specialize in helping trucking businesses like yours stay on track with Form 940, FUTA payments, and every other payroll detail that matters. Let us take this off your mind — so you can get back to running your business with confidence.

Article: Payroll Management: What We Do for Our Clients

Written by Melisa Bush

With over 15 years of experience in the trucking industry, Melisa is well-versed in the complexities of trucking payroll and adept at navigating special circumstances. Before joining Superior Trucking Payroll Service, Melisa worked at a trucking company, where she managed driver miles and expenses for a fleet of 50 trucks. This hands-on experience gives her unique insight into the challenges our clients face when preparing their payroll data.

Melisa’s top priority is customer service. She strives to treat each client as an individual with genuine needs, rather than just another number in the system. Her goal is to alleviate the burdens of our clients and make their daily operations smoother.