What Is Form 944 Used For? Eligibility, Deadlines, and Deposits

Form 944 is used for reporting federal employment taxes once a year instead of every quarter. It’s the IRS’s annual version of Form 941, built for very small employers whose combined yearly liability for withheld federal income tax, Social Security, and Medicare comes to $1,000 or less. Eligible businesses file one return per year covering the same taxes a quarterly filer would report on four separate 941s.¹

What Taxes Form 944 Reports

Three categories of federal employment tax go on the return: the federal income tax you withheld from employee paychecks, the Social Security tax owed by both you and your employees, and the Medicare tax owed by both sides.¹ The form also captures the 0.9% Additional Medicare Tax on wages you pay any single employee above $200,000 in a calendar year. That piece is the employee’s obligation entirely; you just withhold and remit it, with no employer match.²

One boundary worth knowing up front: Form 944 does not cover federal unemployment tax. You still file Form 940 separately each year for FUTA, even if 944 handles the rest of your employment tax reporting.³ Assuming Form 944 covers everything is a common early mistake.

Who Qualifies to File Form 944

Eligibility runs on two conditions, both of which must be met. First, your total annual liability for withheld income tax plus the employer and employee shares of Social Security and Medicare has to be $1,000 or less.¹ In practice that typically means one or two part-time or very low-paid employees. The threshold looks at the combined total, not just the employer side or just the withholding side.

Second, and this catches people off guard, the IRS has to authorize you in writing. You can’t simply switch to Form 944 because your numbers qualify. Either the IRS sends you a notice telling you that you are eligible, or you contact the IRS and receive explicit approval before filing.⁴ Filing Form 944 without that authorization can be treated as an unfiled return, with penalties assessed as if nothing had been submitted.

How to Get on Form 944 (or Switch Back to 941)

If you expect to be under the $1,000 threshold and haven’t received a notice, you have two windows to request the change. Call the IRS at 800-829-4933 between January 1 and April 1 of the tax year, or send a written request postmarked between January 1 and mid-March. For the 2026 tax year, the written request deadline is March 16, 2026. Keep filing Form 941 quarterly until the IRS sends written confirmation of the switch.⁴

New employers can elect Form 944 when they apply for an Employer Identification Number. Line 14 of Form SS-4 lets you indicate that you expect your annual employment tax liability to be $1,000 or less and want to file annually.⁵ That saves a separate call to the IRS after your EIN is assigned.

Going the other direction works the same way. If your liability grows past $1,000 or you’d rather file quarterly, contact the IRS by the same deadlines (call by April 1 or mail a written request by mid-March) to request Form 941. Again, don’t change your filing pattern until the written confirmation arrives. Without it, the IRS still expects Form 944.⁴

When Form 944 Is Due

The standard deadline is January 31 of the year after the tax period. For tax year 2026, January 31, 2027, falls on a Sunday, so the deadline shifts to February 1, 2027.⁶ If you made every deposit on time and in full through the year, you get an extra 10 days, extending the deadline to February 10.⁴

The IRS prefers electronic filing through its e-file system, which gives immediate confirmation. Paper returns go to the IRS processing center assigned to your state, at an address that differs depending on whether a payment is enclosed.⁷ Any balance due must be paid electronically. Executive Order 14247, issued in March 2025, mandates electronic payments for all payments to the federal government, and the IRS enforces this for employment tax returns.⁸ EFTPS, IRS Direct Pay, and your IRS business tax account all work.

Deposits During the Year

Whether you make deposits during the year or just pay when you file depends on a second dollar threshold: $2,500. This is separate from the $1,000 eligibility line for using Form 944.⁴

Under $2,500 in annual liability: no deposit required. Pay the full amount when you file.
$2,500 or more for the year but under $2,500 in each quarter: deposit by the last day of the month following each quarter. If your fourth-quarter liability is under $2,500, you can pay that piece with the return.
$2,500 or more in any quarter: follow the standard monthly or semiweekly deposit schedule based on your lookback period, the same as a quarterly filer.⁴

All deposits go through the Electronic Federal Tax Payment System or your IRS business tax account.⁸ Mailing a check isn’t an option. If you’re not sure whether you’ll stay under $2,500 for the year, depositing along the way is the safer default. There’s no penalty for depositing when you didn’t technically have to.

Penalties for Late Filing or Payment

Miss the filing deadline and the IRS charges 5% of the unpaid tax for each month (or partial month) the return is late, up to 25%.⁹ The math adds up quickly. An employer who owes $800 and files three months late would face $120 in late-filing penalties on top of the tax.

A separate failure-to-pay penalty applies when you file on time but don’t pay in full: 0.5% of the unpaid tax per month, also capped at 25%. If the IRS issues a notice of intent to levy and you still haven’t paid after 10 days, the rate doubles to 1% per month. Setting up an installment agreement drops the rate to 0.25% per month while the agreement is in effect.¹⁰

The heaviest consequence in this area is the trust fund recovery penalty, equal to 100% of the taxes you withheld from employees but failed to turn over to the IRS. The withheld income tax and the employee share of Social Security and Medicare are considered trust fund taxes because you hold them for the government. If the business can’t pay, the IRS can pursue any individual it considers personally responsible for collecting and remitting those taxes, including owners and officers with authority over payroll.⁴ This penalty can reach past the business entity and hit personal assets, which is what makes it one of the few employment tax exposures that follows an owner beyond the company itself.

1
Internal Revenue Service. About Form 944, Employer’s Annual Federal Tax Return
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Internal Revenue Service. Household Employer’s Tax Guide
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Internal Revenue Service. Forms 940, 941, 944 and 1040 (Sch H) Employment Taxes
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Internal Revenue Service. Instructions for Form 944 (2025)
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Internal Revenue Service. Reinstatement of Form SS-4’s Line 14 Election to File Form 944 Annually
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Internal Revenue Service. Instructions for Form 944-X (02/2026)
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Internal Revenue Service. Where to File Your Taxes (for Form 944)
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Internal Revenue Service. Publication 15 (2026), (Circular E), Employer’s Tax Guide
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Office of the Law Revision Counsel. 26 USC 6651 – Failure to File Tax Return or to Pay Tax
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Internal Revenue Service. IRS Notices and Bills, Penalties and Interest Charges