Which payroll tax form is known as the annual return of withheld federal income tax?

The annual return of withheld federal income tax is reported on Form 945. This form is used by businesses to report withholding on certain non-payroll payments, such as backup withholding and withholding on payments made to retirees. It serves as a summary of all the federal income tax withheld throughout the year for these payments, allowing the IRS to verify and ensure that the correct amount has been submitted.

In contrast, Form 944 is used for employers with a lower volume of payroll to report their annual employment tax liability rather than specifically for withholding federal income tax from non-payroll payments. Form 943 is tailored for agricultural employers to report the wages paid to farmworkers and the taxes withheld. Form 1096, meanwhile, is a summary form that transmits various information returns (including Forms 1099) to the IRS and is not exclusively related to the withholding of federal income tax. Thus, Form 945 is uniquely positioned for the specified purpose in the question.