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Form 944 for 2025: Employer’s Annual Federal Tax Return
Charles Hardy | Last Updated: November 14, 2025
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What is Form 944?
Form 944, Employer’s Annual Tax Return, is designed for small business employers to report the annual liability for Social Security, Medicare, and withheld federal income taxes of $1,000 or less. If this applies to you, you can file Form 944 annually instead of filing quarterly Form 941.
If you're a new business owner, the IRS will decide whether you need to use Form 944 or IRS Form 941 to report your payroll taxes when you receive your Employer Identification Number (EIN).
As a small business owner, you must file a Form 944, even if you have no taxes to report. If your business has closed or stopped paying wages, you will have to file a final return for the year by checking the box in line 14 on Form 944.
What’s new in Form 944 for 2025?
The IRS has introduced several important updates to Form 944 for 2025. Here’s a simple breakdown of each update:
Updated Social Security Wage Base for 2025
- The Social Security wage base has increased to $176,100 for 2025.
- The Social Security (6.2%) and Medicare (1.45%) tax rates remain unchanged.
Social Security & Medicare Thresholds for Household and Election Workers
For the 2025 tax year:
- Household workers owe Social Security and Medicare taxes if paid $2,800 or more in cash wages.
- Election workers owe these taxes if paid $2,400 or more.
Direct Deposit Now Available for Form 944 Refunds
You can now receive Form 944 tax refunds via direct deposit, thanks to a new federal initiative promoting electronic payments.
Direct deposit is faster and more secure, though employers may still choose to apply an overpayment to next year’s return.
Electronic Balance Due Payments Required
All Form 944 balance due payments must be made electronically.
The IRS is moving away from paper checks to improve speed and accuracy.
Form 944 Return Transcripts Available Online
Employers can now view and download Form 944 transcripts for tax years 2023 and later through their IRS Business Tax Account.
New Withholding Rules for Qualified Tips (2025–2029)
A new law allows eligible workers to deduct up to $25,000 in qualified tips on their income tax return.
Employers must:
- Use updated withholding methods (Form W-4 + Pub. 15-T)
- Report qualified tips on Forms W-2 or 1099-MISC
- IRS will provide transition relief for 2025.
New Withholding Rules for Qualified Overtime Compensation (2025–2029)
A similar rule now allows workers to deduct up to $12,500 (or $25,000 if married filing jointly) in qualified overtime pay.
Employers must:
- Follow updated withholding procedures
- Report qualified tips on Forms W-2 or 1099-MISC
- Report qualified overtime on Forms W-2 or 1099-MISC
- Transition relief will also apply for 2025.
What information is required to fill out Form 944 for 2025?
Before starting your 944 filing, make sure you have the following information ready to ensure a smooth process:
- Your EIN and other business information
- Total number of employees
- Total payments made to your employees
- Federal income tax and FICA tax withheld
- Balance due if any
- Deposit schedule and tax liability for the year
Need to know more on this? Check our article for additional information and instructions for completing Form 944.
When is Form 944 due for 2025?
Regardless of the method you choose to file your return, Form 944 is generally due by January 31. If the Form 944 due date falls on any federal holiday or weekend, the next business day will be the due date.
Accordingly, the due date to file Form 944 for 2025 is February 02, 2026.
However, there is a separate due date for making your 944 tax deposits. Learn more
Which type of employer cannot use Form 944?
If you are an employer of the below-mentioned categories, then you are not eligible to use Form 944.
- Household employers - If you are an employer of household employees you cannot use Form 944. To know more, check Publication 926 and Schedule H (Form 1040).
- Agricultural employers - If you have only agricultural employees, then you aren’t eligible to file this form. For more information, see Form 943 and Publication 15.
- Employers who received notification from the IRS - Use Form 944 only if you requested and received written confirmation from the IRS that your filing requirement was changed.
- Employers who did not receive notification from the IRS - If the IRS hasn't notified you to file Form 944, don’t use Form 944 to report the payroll taxes withheld.
How is Form 944 different from Form 941?
Both Form 941 and 944 are used to report payroll tax information to the IRS. They only differ in terms of business tax liability and reporting frequency.
Form 941 is used by businesses to report income taxes, Social Security, and Medicare taxes withheld from the employee's paycheck during the year. Form 944 is used to report payroll tax for the business if its annual tax liability is less than $1,000 over the year. Similarly, the deadline for filing Form 941 falls on every quarter, whereas the deadline for filing Form 944 is once a year (i.e., January 31).
Click here to learn about Form 941 vs 944 in detail.
When to complete 945-A on Form 944?
If your tax liability on line 9 is more than $2,500, and if you’re a semiweekly schedule depositor or became one who accumulated $100,000 or more of liability on any day. Then you are required to complete Form 945-A and attach it to Form 944.
The amount on line 9 must be the same as the amount shown on Line M of Form 945-A. The IRS may impose deposit penalties if you fail to complete and submit Form 945-A.
What is the penalty for filing Form 944 late?
If you fail to file IRS Form 944 within the deadline, the IRS may impose a 5% penalty on the unpaid tax for each month your return is late. Additionally, if you pay late or don’t pay in full, it may result in a penalty ranging from 2-15% of the unpaid tax, based on how long the balance due remains unpaid.
For more detailed information about 944 Penalties, click here.
How to file tax Form 944?
When it's time to submit Form 944 and make tax payments, you have a few options to choose from. You can either file Form 944 electronically and pay your taxes online or mail your form and payments to the IRS.
However, the IRS recommends businesses e-file 944 for faster and more secure processing. In order to e-file Form 944 and manage your tax payments, you must get started with TaxBandits, an IRS-authorized e-file provider.
TaxBandits enables you to quickly file your returns with time-saving features, from built-in error checks based on the IRS Business Rules to automated tax calculations. Your 944 filing includes Form 945-A, 8453-EMP, and 944-V.
Click here to learn how to file Form 944 online using TaxBandits.
