What Form 944 Is For
IRS Form 944 (2024) is an annual federal tax return used by small employers with limited employment tax liability. It reports total wages paid, federal income tax withheld, and both the employer and employee shares of Social Security and Medicare taxes. The Internal Revenue Service offers this option to allow eligible small businesses to file annually instead of submitting quarterly returns.
This critical tax form streamlines the process for small employers to handle payroll taxes, income withholding tax payments, and employment tax liability for the year. It helps track employee wages, compensation paid, and accurately withheld federal income taxes. Understanding Form 944 ensures compliance with federal reporting requirements and facilitates the consistent management of yearly tax obligations.
Learn more about Payroll and Employment Tax Forms, including how to file, when to submit, and which forms your business needs.
When You’d Use Form 944 for 2024
Employers file Form 944 for 2024 when their annual employment tax liability is $1,000 or less, and they meet the Internal Revenue Service eligibility to file annually. This form enables small business employers to report federal income tax withheld, Social Security tax, and Medicare tax in a single annual filing, rather than submitting quarterly reports. It also applies when businesses pay employees throughout the year or stop paying wages but still owe employment taxes.
You may need to file or amend Form 944 in these situations:
- Late filing caused by missed tax year deadlines or deposit schedule changes
- Adjustments to wages subject to Social Security and Medicare taxes
- Corrections to income withholding tax payments or federal income tax withheld
- Balances or unpaid tax from prior filings that require correction
Key Rules or Details for 2024
Understanding the key requirements for filing Form 944 in 2024 helps small business employers accurately meet their federal reporting obligations. The form summarizes employment tax liability, total wages paid, and income withholding tax payments for the entire year. Compliance ensures the accurate tracking of Social Security and Medicare taxes for both employers and employees.
- Social Security Tax Rate: Employers and employees each pay 6.2% on wages up to $168,600
- Medicare Tax Rate: Both pay 1.45% of total wages with no income cap, plus additional tax for higher earners
- Annual Liability Threshold: Businesses with an annual tax liability of $1,000 or less are eligible to file annually
- Amended Returns: Use Form 944-X to correct federal income tax withheld or Medicare tax liability
- Filing Deadline: January 31, 2025, or the next business day if a federal holiday applies
Step-by-Step Guide to File Form 944
Filing Form 944 helps small business employers manage their annual employment tax liability and stay compliant with Internal Revenue Service rules. Each stage supports accurate reporting of payroll taxes, total wages paid, and income withholding tax payments for the tax year. Following these steps keeps employer records organized and ensures timely tax payments.
- Prepare Employer Records: The employer gathers employee paychecks, compensation paid, and all wages subject to Social Security and Medicare taxes.
- Verify Key Details: Verify Key Details: The employer confirms the Employer Identification Number, total federal income tax withheld, and adjustments to Medicare taxes or other compensation.
- Complete and Review the Form: The filer enters total employment tax liability, annual income, and any unpaid tax before signing.
- Submit and Pay: The filer submits the completed form electronically or by mail and makes payments using EFTPS or IRS Direct Pay.
Common Mistakes and How to Avoid Them
Filing Form 944 correctly protects small business employers from unnecessary penalties and delays. Errors often occur when calculating employment tax liability, reporting federal income tax withheld, or handling payroll records. Preventing these issues requires careful review and awareness of IRS filing standards.
- Using the Wrong Form: The employer confirms that the annual liability qualifies for Form 944 and not Form 941, and verifies the filing requirement with the IRS before preparing the return.
- Incorrect Employer Identification Number: The filer uses the correct EIN on every tax form and payment to ensure all filings are recorded accurately.
- Miscalculating Payroll Taxes: The employer rechecks all Social Security and Medicare tax figures before submission, using payroll software or a tax preparer for accuracy.
- Missing Signatures or Pages: The filer reviews the completed form to confirm that all pages are signed and attached before mailing or e-filing.
- Late Filing or Payments: The employer plans deposits early, sets reminders before each due date, and uses EFTPS to avoid missed deadlines.
What Happens After You File Form 944
Submitting Form 944 ensures your employment tax information is reviewed and recorded accurately. The Internal Revenue Service verifies the reported federal income tax withheld, Social Security tax, and Medicare tax to confirm they match the total wages paid during the tax year. Employers should retain a copy of the filed form and all supporting payroll records for reference and potential audits.
Processing and IRS Review
The IRS processes annual returns in several weeks, depending on how they are filed. Electronic submissions generally move faster, while mailed forms may take longer to appear in your account. Any errors, unpaid tax, or inconsistencies between filings and payroll data may trigger an official notice.
Payment and Follow-Up
Employers who owe additional employment taxes receive a balance notice with payment options. Those unable to pay in full may request an RS payment plan for employment taxes. Addressing any issues early helps maintain compliance and prevent interest from accruing.
FAQs About Filing Form 944 for 2024
What is IRS Form 944 late filing 2024?
IRS Form 944 Late Filing 2024 occurs when an employer submits the annual federal tax return after the due date. Small business employers with limited yearly employment tax liability must report federal income taxes, Social Security tax, and Medicare tax each year. Late filing may create penalties or interest on unpaid tax amounts.
When should small businesses file Form 944?
Small businesses file Form 944 when their annual tax liability is $1,000 or less, and the Internal Revenue Service authorizes them to file annually. The due date for the 2024 tax year is January 31, 2025, or the next business day if January 31 falls on a federal holiday. Timely filing of Form 944 prevents issues with withheld federal income taxes.
How are payroll taxes and income withholding tax payments reported?
Employers report total wages paid, income withholding tax payments, and federal income tax withheld on Form 944. Both the employer and employee shares of Social Security and Medicare taxes must be included. Maintaining accurate payroll tax records supports the calculation of employment tax liability.
What happens if employment taxes remain unpaid?
If any portion of the employment tax liability remains unpaid, the Internal Revenue Service issues a balance notice. Employers may make tax payments electronically or apply for an IRS payment plan for employment taxes. Prompt payment prevents further tax liability and reduces the accumulation of interest.
Can a tax professional help file Form 944?
A qualified tax preparer or tax professional can review Employer Identification Numbers, confirm total wages paid, and verify tax deposits. They also assist small business employers with Medicare tax adjustments, annual tax liability calculations, and filing requirements. Working with a professional helps ensure compliance with federal tax obligations.
