To reduce burden on small employers, the Internal Revenue Service (IRS) has simplified the rules for filing employment tax returns to report social security, Medicare, and withheld federal income taxes.
If you have been filing Form 941, Employer’s QUARTERLY Federal Tax Return, and believe your employment taxes for the calendar year will be $1,000 or less and would like to file Form 944, Employers ANNUAL Federal Tax Return, instead of Form 941, you must contact the IRS to request to file Form 944 rather than Form 941. You may make the request by calling the IRS at 1-800-829-4933 by April 1 of the current year, or by sending a written request, postmarked by March 15 of the current year, to:
Department of Treasury, Internal Revenue Service,
Ogden, UT 84201-0038
Department of Treasury, Internal Revenue Service,
Cincinnati, OH 45999-0038.
Select the appropriate addresses above based on the state you are in. See “Without a payment” under the “Where Should You File” section of the Instructions for Form 944.
If you do not receive written notice from the IRS to file Form 944, you must file Forms 941 for the current calendar year.
What if you want to file Forms 941 instead of the Form 944?
You must file Form 944 if the IRS has notified you to do so, unless you contact the IRS to request, and receive written notice, to file quarterly Form 941 instead. This is true even if your employment taxes for the year will be over $1,000. If you receive notice to file Form 944, you do not have the option to file quarterly Form 941, unless you follow the procedures to opt out of the Form 944 program. If you are required to file Form 944 but file a Form 941, you will be notified that the Form 941 you submitted will not be processed and advised that you must file a Form 944 unless you follow the procedures to opt out of the Form 944 program. Additionally, you must deposit employment taxes using the form number that the IRS has notified you to file, and using the correct deposit rules based on your tax liabilities as discussed below.
To request to file quarterly Forms 941 to report your social security, Medicare, and withheld federal income taxes for the current calendar you may make the request by calling the IRS by April 1 of the current year, or by sending a written request, postmarked by March 15 of the current year using the same contact information as above.
The IRS will send you a written notice that your filing requirement has been changed. If you do not receive this notice, you must file Form 944 for the current calendar year. See Rev. Proc. 2009-51, 2009-45 I.R.B. 625, for additional information.
How do I make the election to file Form 944 if I am a new business or just hired employees for the first time?
If you are starting a new business and completed Form SS-4, Application for Employer Identification Number, you will receive a notice listing the employment tax forms you are required to file. If you hired employees for the first time, and were not assigned a specific employment tax return to file, you must file Forms 941 unless you contact the IRS to request to file Form 944 rather than Forms 941. You must not file Form 944 unless you receive written notification that you are eligible to do so. If you are a new employer, you must call the IRS, at the number listed above, on or before the first day of the month that the first required Form 941 for the current year is due to request to file Form 944 rather than Form 941. If you want to write to request to file Form 944 for the current year, you must have your written correspondence, addressed to the appropriate mailing address listed above, postmarked on or before the 15th day of the month before the first required Form 941 is due. Once you file Form 941 or you receive written notice to file Form 944, you cannot change the type of return you are filing without contacting the IRS as explained above.
When will I file Form 944?
This return is due once a year, by January 31, after the end of the calendar year. If you made timely deposits in full payment of your taxes by January 31, you have 10 additional calendar days to file your Form 944. You may file Form 944 electronically. See the list of Authorized e-file Providers.
When will I pay my employment taxes?
You may pay once a year when you file your return, unless you are required to make Federal Tax Deposits (FTDs). If your liability for social security, Medicare, and withheld federal income taxes is less than $2,500 for the year, you can pay the taxes with your return. However, you may choose to make deposits of these taxes even if your liability is less than $2,500.
If your liability for these taxes is $2,500 or more, you are generally required to deposit the taxes instead of paying them when you file Form 944. See the Federal Tax Deposit Requirements for Form 944 Filers chart located in the Instructions for Form 944. If you do not deposit the taxes when required, you may be subject to penalties and interest. See Publication 15 (Circular E), Employers Tax Guide for FTD deposit requirements.
Taxpayers must use electronic funds transfer to make all federal tax deposits. Generally electronic funds transfers are made using the Electronic Federal Tax Payment System (EFTPS). See Publication 15 (Circular E), Employer’s Tax Guide for more information on EFTPS and electronic funds transfer.
What payment methods may I use?
- If you file a paper return, you may pay by check, money order, credit card, or the Electronic Federal Tax Payment System (EFTPS).
If you file your return electronically, you may also pay by authorizing an Electronic Funds Withdrawal (EFW)from your checking or savings account.
To make more frequent deposits, you may use EFTPS.
Where can I find more information on the Form 944 program?
Please see the Form 944 Instructions (PDF).