What is the estimated annual employment tax liability threshold for an employer to file form 944?

For employers, the requirement to file Form 944, which is the Employer's Annual Federal Tax Return, is based on the estimated annual employment tax liability threshold. Specifically, an employer must file Form 944 if their total annual payroll tax liability is expected to be $1,000 or less. This threshold allows smaller employers to submit one annual return instead of quarterly returns (Form 941).

Filing Form 944 is advantageous for those employers because it simplifies the process and reduces the frequency of tax filing. If the employer’s estimated tax liability exceeds this threshold, they are generally required to file Form 941 quarterly instead. Understanding these thresholds helps employers effectively manage their payroll obligations and compliance with federal tax regulations.