Some employers with smaller payrolls will file Form 944, Employer's ANNUAL Federal Tax Return each year, instead of filing Form 941, Employer's QUARTERLY Federal Tax Return each quarter. Generally, if you have annual liability of $1,000 or less for withheld income tax, Social Security and Medicare tax, you are affected by this change in filing requirement and you will be notified by the IRS early in the year.
Form 944 is a payroll tax form on which you report:
- Employee wages you have paid
- Tips your employees have received
- Federal income tax you withheld
- Both the employer's and the employee's share of social security and Medicare taxes
- Advance earned income tax credit (EIC) payments
You file these returns annually, on a calendar-year basis, even if your fiscal year is different from the calendar year. How quickbooks calculates numbers on Form 944
Important: If your annual tax liability is less than $2,500, you can deposit your tax payment with your Form 944 return if you file your return on time. Note that the $2,500 threshold for tax deposits are different than the $1,000 annual tax liability that enables an employer to file Form 944. For more the most current information about deposit requirements for Form 944 filers, review the Federal Tax Deposit Requirements for Form 944 Filers chart in the IRS Form 944 instructions or contact the IRS.