Send your Form 940 payment to the IRS, not your state — the address depends on whether you're paying electronically or by check

Form 940 is a federal unemployment tax return, so the IRS collects the payment, not your state unemployment office. If you're paying by check, you mail it to a specific IRS address based on your location. If you're paying electronically — which is faster and reduces errors — you use the IRS's Electronic Federal Tax Payment System (EFTPS) or you can pay through your tax software or financial institution. The method you choose affects where the money goes and how quickly it's processed.

The key difference is speed and certainty. Mailed checks take 2 to 4 weeks to post after the IRS receives them, and using the wrong address adds weeks more. Electronic payments post the same day or next business day. If you're within a week of the January 31 important date, electronic payment is the only safe choice.

Key Takeaways

  • Form 940 payments go to the IRS, not to your state, because unemployment tax is a federal tax collected by the federal government.
  • If paying by check, mail it to the IRS address for your region — the correct address is listed on the Form 940 instructions or the IRS website, and using the wrong address delays processing.
  • Electronic payment through EFTPS, tax software, or your bank is faster than mailing a check and reduces the risk of lost mail or processing delays.
  • Your payment must arrive by the Form 940 due date (usually January 31 for the prior year) or you'll owe penalties and interest, even if you filed the form on time.
  • If you've already paid state unemployment tax, you may be able to claim a credit on Form 940, but that's separate from where you send the federal payment.

Mailing a check to the IRS

If you're paying by check, the IRS has regional addresses based on where your business is located. The correct mailing address is printed in the Form 940 instructions booklet that comes with the form, or you can find it on the IRS website under "Where to File." Using the wrong address is common and causes delays — the check may be routed to the wrong processing center and take weeks longer to post to your account.

Write your employer identification number (EIN) and "Form 940" on the check itself. Mail the check with a copy of your completed Form 940 to the address listed for your state. The IRS processes mailed payments more slowly than electronic ones — typically 2 to 4 weeks after they receive it — so if you're close to the important date, electronic payment is safer. Do not mail your check to your state unemployment office; it will be forwarded to the IRS, but this adds another 2 to 4 weeks to processing time.

Paying electronically through EFTPS

EFTPS is the IRS's official system for electronic tax payments. You enroll once (it takes a few days for the IRS to set up your account), then you can schedule payments online or by phone. Payments made through EFTPS are usually processed the same day or the next business day, so there's no risk of mail delays. You can schedule a payment for any date up to and including the due date, which gives you flexibility if cash flow is tight.

To use EFTPS, go to www.eftps.gov, create an account with your EIN, and set up your bank account information. Once enrolled, you can schedule your Form 940 payment and the system will ask you to specify that the payment is for Form 940 (unemployment tax), not income tax or another type of federal tax. If you miss the important date, you can still pay through EFTPS, but you'll owe penalties and interest from the original due date.

Paying through tax software or your bank

Many tax software packages (including those used by accountants and payroll services) let you pay Form 940 directly from the software without logging into EFTPS separately. The software routes your payment to the IRS through EFTPS behind the scenes. This is convenient if you're already using the software to prepare your return, and it's just as fast as paying through EFTPS directly.

Some banks also offer bill-pay services that can send a check to the IRS on your behalf, but this is slower than electronic payment and not recommended if you're near the important date. If you use your bank's bill-pay, make sure you initiate it at least 5 to 7 business days before the due date to account for processing time. Bill-pay checks still travel through the mail, so they carry the same delay risk as mailing a check yourself.

Timing and important date

Form 940 is due on January 31 of the year following the tax year it covers. For example, your 2023 Form 940 is due January 31, 2024. If January 31 falls on a weekend or holiday, the important date moves to the next business day. The payment must arrive by the due date — postmarked by the due date is not enough for mailed checks. The IRS considers a payment on time only when it's received and posted to your account.

If you file Form 940 late but pay on time, you owe a failure-to-file penalty. If you pay late but file on time, you owe a failure-to-pay penalty. If you do both late, you owe both penalties plus interest. Electronic payment eliminates the risk of mail delays, so if you're within a week of the important date, it's the safer choice. Interest accrues daily on any unpaid balance from the original due date forward.

What happens if you send the payment to the wrong place

If you accidentally mail your check to your state unemployment office or to a state tax agency, it will eventually be forwarded to the IRS, but this adds 2 to 4 weeks to processing time. During that delay, your account may show as unpaid, and you could receive a notice from the IRS. You won't owe additional penalties if the delay was caused by mailing to the wrong address, but you will owe interest from the original due date.

If you're unsure whether your payment was received, you can check the status of your Form 940 payment through your IRS online account (if you have one) or by calling the IRS at 800-829-1040. Have your EIN and the amount of the payment ready. If the IRS received your payment but it's still showing as unpaid weeks later, ask them to trace the check or payment and confirm the posting date.

Frequently Asked Questions

Can I pay Form 940 to my state unemployment office?

No. Form 940 is a federal tax, so the payment goes to the IRS only. Your state may collect its own unemployment tax on a separate form, but that's a different payment sent to a different place. Don't combine them or send federal and state payments to the same address.

What if I can't pay the full amount by the due date?

Pay whatever you can by the important date to reduce interest and penalties. You can set up a payment plan with the IRS for the remaining balance. Contact the IRS or work with a tax professional to arrange installments. Interest and penalties will accrue on the unpaid balance until it's settled.

Do I need to send Form 940 and the payment together?

No. You file Form 940 separately (by mail or electronically through tax software) and send the payment separately. They don't have to arrive on the same day. However, both must be submitted by the due date to avoid penalties.

Is there a difference between paying through EFTPS and paying through my tax software?

Not to the IRS — both methods route your payment through EFTPS electronically and are processed the same way. Use whichever is more convenient for you. Tax software is often easier if you're already using it to prepare the form.

What if I overpaid Form 940 last year?

You can request a refund, or you can explore the overpayment to this year's Form 940 payment. You'll indicate your choice on the Form 940 itself. A refund takes 4 to 6 weeks to process if you request one.