FUTA Tax Deposit Due Dates 2026: The $500 Rule
FUTA tax deposits are due after a quarter only when your accumulated, undeposited federal unemployment tax is more than $500. For 2026, the quarterly deposit dates are April 30, July 31, November 2 and February 1, 2027. If the balance is $500 or less, carry it into the next quarter instead of depositing it.
That rule is easy to misread. The trigger is “more than $500,” not “$500 or more,” and the balance includes FUTA carried forward from earlier quarters. Form 940 is an annual return, but a required FUTA payment can become due during the year.
Deposit FUTA by the last day of the month after a quarter when the quarter’s liability plus prior undeposited FUTA exceeds $500. A balance of exactly $500 may be carried forward. Employers make federal tax deposits electronically; employees should never have FUTA withheld from their pay.
July 31, 2026 is the Q2 deposit date for an accumulated FUTA balance over $500 as of June 30. A timely Form 941 does not satisfy this separate FUTA deposit duty. If the deposit is late, make it promptly and review the IRS penalty guidance.
2026 FUTA Tax Deposit Due Dates
The normal deadlines are the last day of the month following each quarter. Because October 31, 2026 and January 31, 2027 fall on weekends, those deadlines move to the next business day.
| Liability measured through | Deposit if accumulated balance is over $500 | 2026 deposit deadline |
|---|---|---|
| March 31, 2026 | Q1 liability plus any earlier carryover | April 30, 2026 |
| June 30, 2026 | Q2 liability plus undeposited Q1 | July 31, 2026 |
| September 30, 2026 | Q3 liability plus any undeposited balance | November 2, 2026 |
| December 31, 2026 | Q4 liability plus any undeposited balance | February 1, 2027 |
Quarterly FUTA deposits are payments made when the balance crosses the threshold. Form 940 is the annual return used to report the year’s FUTA tax. Do not wait for Form 940 if a quarterly deposit has already become due.
Who Generally Owes FUTA Tax?
Most businesses become subject to FUTA under either of two general IRS tests. The business paid at least $1,500 in wages during any calendar quarter in 2025 or 2026, or it had at least one employee for part of a day in 20 or more different weeks during 2025 or 2026. The weeks do not have to be consecutive, and different employees can satisfy the weekly test.
Household employers, agricultural employers, nonprofit organizations, government employers, successor employers and businesses with family employees can face different tests or exceptions. Confirm the applicable section of IRS Publication 15 before treating a worker or payment as subject to FUTA.
FUTA is paid by the employer. It should not be deducted from an employee’s paycheck. State unemployment insurance is separate and follows state rules. If you are reviewing an employee-facing line, see how SUI or SUTA may appear on a pay stub.
How the FUTA $500 Carryover Rule Works
- Calculate FUTA liability for the quarter.
- Add any FUTA carried over from an earlier quarter.
- If the result is more than $500, deposit the full accumulated amount by the quarterly deadline.
- If the result is $500 or less, carry it forward and test the combined balance again after the next quarter.
After making a required deposit, start the next quarter’s test with only the new undeposited liability. If the fourth-quarter balance plus carryover is $500 or less, the IRS permits an employer to deposit it or pay it with Form 940 by the annual deadline.
IRS Publication 15, IRS Topic 759 and the Form 940 instructions say that $500 or less may be carried forward and that a deposit is required once accumulated FUTA is more than $500. One general IRS due-date page currently uses “$500 or more” in a nearby sentence. This guide follows the more specific Form 940 sources and treats exactly $500 as eligible for carryover.
How to Calculate FUTA Tax for 2026
For 2026, the gross FUTA rate is 6% on the first $7,000 of FUTA-taxable wages paid to each employee. Employers that qualify for the full 5.4% state unemployment credit generally have an effective federal rate of 0.6%. Only the employer pays FUTA; it is not an employee deduction.
A simple planning estimate for a full-credit employer is:
FUTA-taxable wages for the quarter, limited by each employee’s remaining $7,000 annual wage base, multiplied by 0.6%. Then add any undeposited FUTA carried forward.
Suppose a full-credit employer has three employees. Employee A has earned $8,000 during 2026, so only the first $7,000 is within the FUTA wage base. Employee B has earned $5,000, all within the wage base. Employee C earned $3,000 in earlier quarters and another $5,000 this quarter, so only $4,000 of the new wages remains below that employee’s annual limit.
| Employee | 2026 wages | Wages used for FUTA estimate | Estimated FUTA at 0.6% |
|---|---|---|---|
| Employee A | $8,000 | $7,000 | $42 |
| Employee B | $5,000 | $5,000 | $30 |
| Employee C | $8,000 total | $7,000 total, including only $4,000 from the current quarter | $42 |
| Total | $21,000 | $19,000 | $114 |
The 0.6% shortcut may not equal the final liability when state unemployment contributions were late, excluded, paid at a lower rate, or subject to a credit reduction. Use payroll records and current Form 940 instructions for the filed amount. The wage base also differs from Social Security and other payroll limits discussed in the guide to taxable wages and wage bases.
A Full-Year FUTA Carryover Example
This ledger shows the detail that a one-quarter example can hide: once the employer deposits the accumulated balance, the carryover resets to zero. A later quarter starts a new accumulation test.
| Quarter | New liability | Carryover entering quarter | Accumulated balance | Required action | Carryover leaving quarter |
|---|---|---|---|---|---|
| Q1 | $420 | $0 | $420 | No deposit; balance is $500 or less. | $420 |
| Q2 | $160 | $420 | $580 | Deposit the full $580 by July 31, 2026. | $0 |
| Q3 | $240 | $0 | $240 | No deposit; begin a new carryover. | $240 |
| Q4 | $180 | $240 | $420 | Deposit voluntarily or pay with Form 940 by February 1, 2027. | $420 until paid |
Compare the exact threshold with two shorter cases. An accumulated balance of exactly $500 may be carried forward. An accumulated balance of $510 must be deposited by the applicable quarterly deadline. A full-credit employer with 14 employees who each reach the $7,000 wage base would estimate annual FUTA of $588: 14 × $7,000 × 0.006.
How FUTA Liability and Deposits Connect to Form 940
Form 940 separates the tax you incurred from the money you deposited. Keeping those figures separate is essential when you reconcile the annual return.
| Form 940 area | What belongs there | What does not belong there |
|---|---|---|
| Line 12 | Total FUTA tax after adjustments | A single quarterly deposit amount |
| Line 13 | FUTA deposited for the year, including an overpayment applied from an earlier year | The dates when the liability arose |
| Lines 16a–16d | FUTA tax liability for each quarter | The amount paid or the date of each payment |
| Balance due or overpayment lines | The difference after comparing annual tax with deposits | A substitute for reconciling the quarterly records |
Line references above follow the current Form 940 structure available during this review. Before filing for 2026, compare them with the final IRS-issued 2026 form and instructions. Do not use an IRS draft as a filing-ready return.
The quarterly liability total should reconcile to the annual FUTA tax after applicable adjustments. Keep payroll registers, state unemployment records and electronic deposit confirmations together. The ePaystubs guide to payroll-record retention explains what to preserve with employer tax returns.
How Credit-Reduction States Affect the Fourth-Quarter Deposit
The standard planning calculation assumes the employer qualifies for the full state unemployment credit. A state or territory can lose part of that credit when it has an outstanding federal unemployment loan and meets the statutory conditions for a credit reduction.
The official determination is made later in the year. If a credit reduction applies, IRS guidance says to include the additional liability with the fourth-quarter deposit. Do not treat a projected 2026 state rate as final before the U.S. Department of Labor and IRS publish the applicable tax-year information.
Use the normal quarterly calculation for the first three quarters, monitor official credit-reduction guidance, and reconcile the additional amount during the fourth-quarter Form 940 close. Multi-state employers may also need Schedule A.
How to Make a FUTA Deposit
Federal tax deposits must be made by electronic funds transfer. The IRS lists a business tax account, Direct Pay for businesses and the Electronic Federal Tax Payment System among the available methods. A financial institution, tax professional or payroll service may also initiate an eligible electronic payment.
Do not send a paper check as a substitute for a required federal tax deposit. The IRS may assess a deposit penalty when a payment is late, short or made using the wrong method.
FUTA Deposit Mistakes to Catch Before the Deadline
- Using $500 as the trigger: exactly $500 may be carried forward; the deposit trigger is more than $500.
- Testing only the current quarter: include any undeposited balance carried from an earlier quarter.
- Withholding FUTA from employees: FUTA is employer-paid. For the employee-facing state unemployment line, see the guide to SUI and SUTA on a pay stub.
- Applying 0.6% automatically: the full state credit must be available for that effective rate.
- Confusing FUTA with Form 941 taxes: the Form 941 calendar and deposit rules cover federal withholding and Social Security and Medicare taxes, not FUTA.
- Ignoring employee-level wage bases: the $7,000 FUTA limit applies separately to each employee. Compare it with other limits in the guide to taxable wages and wage bases.
What to Do If a FUTA Deposit Is Late
Make the correct electronic deposit as soon as possible and save the confirmation. The IRS failure-to-deposit penalty generally depends on how many calendar days the deposit is late: 2% for 1–5 days, 5% for 6–15 days and 10% after 15 days; a 15% rate can apply after specified notice timing. The rates do not stack on top of one another.
Reasonable-cause relief can be fact-specific. Do not assume it applies. If the amount, tax period or payment history is unclear, compare the payroll ledger with the IRS account and consult a qualified payroll or tax professional.
After confirming the quarterly liability, carryover and electronic deposits, you can prepare Form 940 with ePaystubs using accurate employer payroll records. Preparing or downloading a document does not make the FUTA deposit, transmit the return to the IRS or prove that the IRS received it. Complete the required deposit and filing through a current IRS-supported method and retain the confirmations.
Frequently Asked Questions
Form 940 is filed annually, but FUTA deposits can be due quarterly when accumulated undeposited liability is more than $500.
No quarterly deposit is required under the general IRS rule when the accumulated balance is exactly $500. Carry it into the next quarter and test the combined amount again.
July 31, 2026, if accumulated undeposited FUTA was more than $500 as of June 30, 2026.
No. FUTA is paid by the employer and should not be withheld from employee wages.
No. Form 941 reports federal income-tax withholding and Social Security and Medicare taxes. FUTA is deposited separately and reported annually on Form 940.
Line 13 generally reports total FUTA deposited for the year, while lines 16a through 16d report the liability that arose in each quarter. The quarterly liability boxes are not a list of payments. Confirm the line numbers against the final form revision for the tax year.
The additional credit-reduction liability is generally included with the fourth-quarter deposit after the tax-year determination. Monitor official guidance rather than treating projected state rates as final.