This week’s question comes from Scott, a small business owner. I have received notification from the Internal Revenue Service (IRS) that I should file Form 944. Should I file Form 944 instead of Form 941? Answer: Employers who are notified that they should file Form 944 must file Form 944 unless they opt out of filing Form 944. In TD 9440, the IRS issued revised “temporary regulations relating to the annual filing of Federal employment tax returns and requirements for employment tax deposits.” These regulations make participation in filing Form 944 voluntary, beginning in 2010. According to Rev. Proc. 2009-13, employers are eligible to opt out in 2009 if they meet one of the following conditions:

1. The employer anticipates that its employment tax liability for tax year 2009 will be more than $1,000; or
2. The employer wants to file electronically quarterly Forms 941 for tax year 2009.

Eligible employers who had previously filed Form 941 or Form 944 must either call the IRS before April 2, 2009 or have written correspondence postmarked no later than March 15, 2009 to opt out of filing the 2009 Form 944.

Businesses newly required to Form 941 or Form 944 have their due dates based on the month their first Form 941 will be due. Telephone calls must therefore be made before April 2, 2009, July 2, 2009, October 2, 2009, or January 2, 2010 if their filing requirement is effective for the first, second, third, or fourth quarter, respectively. Written correspondence must be postmarked no later than the fifteenth of the month prior to the month that the Form 941 is first due. For 2009, the postmark due dates are March 15, 2009, June 15, 2009, September 15, 2009, and December 15, 2009.

As with most federal tax deadlines, any due date that falls on a Saturday, Sunday, or legal holiday is extended to the next day that is not a Saturday, Sunday, or legal holiday. For example, the March 15, 2009 deadline is automatically extended to March 16, 2009.

Whether an employer files Form 941 or Form 944, the deposit rules are generally the same, although “the de minimis deposit amount may be different.”

Contact Vision Payroll if you have any questions on the filing of Form 941 or Form 944 and the related tax deposit requirements.