What IRS Form 944 (2015) Is For
IRS Form 944 (2015) was created by the Internal Revenue Service to simplify annual tax reporting for the smallest employers. It is specifically intended for businesses with an annual tax liability of $1,000 or less for federal income tax withheld, Social Security tax, and Medicare taxes. This form allows these eligible employers to file and pay their employment taxes once per year instead of filing quarterly Forms 941.
Form 944 is not available to every employer; it is limited to those who receive a written notice or written request from the IRS granting permission to file annually. This form is intended to help small businesses manage their payroll taxes more efficiently while reducing administrative work. Employers using Form 944 must follow the same employment tax rules under the Internal Revenue Code.
When You’d Use IRS Form 944 (2015)
Employers would file IRS Form 944 (2015) when specific conditions apply, such as filing late or making corrections for the 2015 tax year.
- Late filing due to missed due date: Employers who did not submit Form 944 by February 1, 2016, should file as soon as possible to reduce interest and IRS penalties.
- Amended filing for corrections: Employers who need to correct errors on a previously filed Form 944 should use Form 944-X, which allows them to adjust overreported or underreported amounts.
- Received official IRS notification: Only employers who received a written notice or written request from the IRS for the 2015 tax year are eligible to file Form 944 instead of quarterly forms.
- Business or address changes: If your employer identification number, address, or ownership information changed after the original filing, you must file an amended or corrected form to ensure IRS records remain accurate.
- Unfiled return resolution: If you received an IRS notice regarding a missing or unfiled 2015 return, filing Form 944 promptly can help resolve your account and prevent enforcement actions.
Before starting your late or amended filing, review an IRS account transcript to confirm what wages, deposits, and prior filings the IRS already has on record for 2015.
Key Rules or Details for 2015
These details help ensure that all employment taxes, including Social Security and Medicare, are reported accurately.
- Social Security and Medicare rates: For 2015, the Social Security tax rate was 6.2% for employers and employees on wages up to $118,500, and the Medicare tax rate was 1.45% each on all wages paid.
- Additional Medicare Tax: Employees who earned more than $200,000 in wages were subject to an additional 0.9% Medicare tax, which did not require an employer match.
- Deposit schedule: Employers must make all federal tax deposits through the Electronic Federal Tax Payment System (EFTPS) if their total taxes for the entire year exceeded $2,500.
- Due date and filing requirements: The original due date for the 2015 return was February 1, 2016, or February 10, 2016, for those who made deposits on time.
- Annual liability limitation: Only employers whose total yearly federal tax liability was $1,000 or less were eligible to file IRS Form 944 (2015) instead of quarterly Form 941.
- Accurate reporting of wages paid: Employers must include all wages, tips, and other taxable compensation in total wages reported on the form.
If the IRS issues balance due notices or questions about your 2015 filing, understanding the IRS collection process can help you prepare for the next steps and avoid escalating enforcement actions.
Step-by-Step (High Level)
These steps can help employers file their late or amended IRS Form 944 (2015) correctly while reducing the risk of IRS notices or processing delays.
- Obtain prior-year records: Use Form 4506-T or your online IRS account to request payroll and tax transcripts for 2015 and verify reported wages and deposits.
- Complete the correct form: Use the official 2015 IRS Form 944 and ensure your employer identification number, business name, and address are accurate and consistent with IRS records.
- Attach required documentation: Include any necessary schedules, statements, or explanations, and clearly mark “LATE FILING” at the top if applicable.
- File and pay through proper channels: Submit the completed form by mail to the address listed in the 2015 IRS instructions or electronically through an authorized e-file provider; if taxes remain due, make payments through EFTPS or request an installment agreement using Form 9465.
- Keep thorough records: If requested, retain copies of the filed form, tax payments, and payroll documentation for at least four years after the filing date for IRS review.
Employers who filed late or made reporting errors may qualify for penalty abatement if they can show reasonable cause for missing the original 2016 deadline.
Common Mistakes and How to Avoid Them
Understanding these common mistakes can help prevent issues and maintain accurate payroll tax compliance.
- Using the wrong form: Employers should only file IRS Form 944 if the IRS has issued a written notice authorizing them; otherwise, quarterly Forms 941 must be filed to meet the filing requirement.
- Incorrect EIN or business information: Always verify that the employer identification number, business name, and mailing address exactly match IRS records to avoid processing delays or misapplied payments.
- Misreporting wages paid: Employers must ensure that all wages, tips, and taxable compensation reported on Form 944 align with Forms W-2 and W-3 totals to prevent mismatch notices.
- Failing to make deposits properly: If your total taxes exceeded $2,500 for the year, do not include payments with the return; all deposits should be made electronically through EFTPS following the proper deposit schedule.
- Incomplete or missing signatures: The employer and, if applicable, the tax professional must sign paper returns to ensure the filing is considered valid by the Internal Revenue Service.
- Incorrect calculations: Employers should double-check all credit amounts, adjustments, and total taxes to prevent errors that may lead to amended filings or penalty assessments.
If additional tax is due on your late Form 944 (2015), you can request an IRS payment plan to pay the balance over time rather than in a single lump sum.
What Happens After You File
Once IRS Form 944 (2015) is filed, the Internal Revenue Service typically processes electronic submissions within two to three weeks and paper filings within six to eight weeks. Employers may receive notices requesting clarification or documentation if amounts appear inconsistent with previously filed forms.
Interest and penalties accrue on unpaid balances beginning from the original due date. If additional tax is due, business owners can make payments through EFTPS or request an installment agreement using Form 9465. Misreported wages, incorrect EINs, or failing to meet deposit requirements can quickly turn into larger payroll tax problems that require professional assistance to fix.
FAQs
How does federal income tax relate to IRS Form 944 (2015)?
IRS Form 944 (2015) reports the federal income tax withheld from employees’ wages and Social Security and Medicare taxes. If corrections are required, employers should file a Form 944-X adjusted return to amend amounts reported on the original filing.
What happens if my tax liability is higher than expected?
If your annual tax liability exceeded $1,000, you could not use Form 944 and should have filed quarterly Forms 941 instead. Employers who overreported or underreported must file a Form 944-X adjusted to correct their employer’s annual federal tax return.
Which tax forms do I use to fix reporting errors?
To correct previously filed Form 944 returns, employers must use Form 944-X. This form is designed to fix errors, including miscalculations related to family leave wages, tips, or withholding discrepancies from the original filing.
Can I claim a payroll tax credit on Form 944?
Eligible employers may claim a payroll tax credit for qualified wages, such as family leave wages or research activities. These credits should be accurately reported on Form 944-X and adjusted to ensure proper calculation of the employer’s annual federal tax.
