|
|
|
|
Home / Finance / Taxes
Failure To Pay Employment Taxes – Penalties
By:Richard A. Chapo
As an employer, you must pay employment taxes if you have employees. Fail to pay and the IRS will rain all over your parade.
Penalties
If you have employees, you absolutely must deduct and withhold various taxes from the paychecks of your employees. Since you are deducting money from the employee’s paycheck, you are handling their funds. This fact is very important to the IRS and it places great emphasis on any failure to deposit employment taxes.
If you fail to pay employment taxes, you will be subject to a 100 percent penalty. Yes, 100 percent. Known as the “trust fund recovery penalty”, the penalty is assessed against the person responsible for paying the taxes, not the entity. The person can be the owner, corporate officer or other “responsible person.” In short, a business entity is not going to protect you from the wrath of the IRS.
Late Payments
Cash flow crunches are an inevitable event for practically every business. So, what happens if you make a late payment for employment taxes. Unless you can show a reasonable reason for the delay, the IRS is going to penalize you.
Late payment penalties range in amount depending on the delay. If the delay is less than six days, the penalty is two percent. Delay for six to 15 days and you are looking at five percent. More than 15 days in delay is going to push the penalty to 15 percent. If you delay this long, the IRS will be peppering you with penalty notices telling you where you stand.
In Closing
Whatever you do, make sure you deposit employment taxes with the IRS in a timely fashion. Take a moment to think about the worst thing you have ever heard done by the IRS. If you fail to pay employment taxes, the actions taken by the IRS will be ten times worse and you will be the one telling horror stories.
Article Source: http://www.dailynewarticles.com
Richard Chapo is with www.businesstaxrecovery.com - recovering overpaid taxes for small businesses. Visit our article page - www.businesstaxrecovery.com/articles - to read more tax articles.
More Articles from Taxes Category:
What Is A Standard Tax Deduction?
What Is An LLC Tax Deduction?
Decoding the IRS Dependent Rules! How Do I Know When to Claim a Dependent?
Small Business Tax Deductions - Top 5
Tax Planning - What Filing Choices Are There?
A Simple Introduction To Filing Electronic Taxes
What Would It Mean To Pass The FairTax Plan?
New Laws on Donating a Car
Why Our Political Leaders Should Embrace the Fair Tax Plan.
Income Tax Software - The Best Ones On The Market
It's a Taxing Time of Year
1099-MISC Forms For Independent Contractors for 2005
Getting The Biggest Benefit From Tax Help
Getting A Tax Break With Your Hybrid Vehicle
Home Office Tax Expenses
|
|
