Schedule A (Form 940) Definition
Term Definition
Schedule A (Form 940) lists all credit reduction states and their applicable tax rates for employers doing business in those states. Employers use this form to determine their federal unemployment (FUTA) tax rate in their state and the annual 940 tax they will owe.
Extended Definition
States listed on Schedule A as credit reduction states borrowed federal funds to meet their unemployment obligations. Employers doing business in any of these states subsequently pay more in FUTA tax due to the reduced credit. Employers should attach the completed Schedule A when they file their annual form 940.
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What is Schedule A (Form 940)?
Last Updated By
Patriot Software | Dec 30, 2014