Payroll Tax Problems
PAYROLL TAXES ARE THE HIGHEST PRIORITY FOR THE IRS.
The IRS is aggressive in collecting unpaid taxes and their absolute highest priority is the collection of payroll taxes that are withheld by an employer and not paid to the IRS in a timely manner. The IRS moves more quickly and more harshly against employers who do not pay their payroll taxes and use the tax money to run their business. However, not only can we get an employer a monthly installment agreement, we can probably get the installment agreement for a lesser monthly payment and much longer than the IRS will tell you.
The IRS is very serious about collecting income taxes that have not been paid, whether personal or corporate. However, they have special zeal and different tools available when it comes to collecting taxes that have been withheld from employee paychecks in trust to be paid into the employee's Social Security Trust Fund, Medicare Trust Fund and income tax withholding account.
The IRS places a higher priority on collecting these withheld taxes because they consider the company failing to pay a deliberate action and a form of embezzlement. Penalties are large and can add thousands of dollars to the amount due. In egregious cases the IRS can close down the business and even consider criminal action.
One of the harshest tools is the IRS ability to collect these unpaid taxes personally from officers or even employees of the corporation. Any individual who knew about the unpaid taxes and/or had the authority to pay the payroll taxes is potentially liable. This could be anyone who had the authority or duty to collect, account for or pay the monthly payroll taxes. If the IRS cannot collect amounts owed by corporation they will assess any or all of these individuals personally with the Trust Fund Recovery Penalty which is approximately 75% of the total payroll tax liability.
The IRS offers far less leeway regarding payment plans or Offers in Compromise with regard to payroll taxes. They will quickly file a lien on all property, equipment, inventory and any other corporate asset they can find. They will levy business bank accounts over and over until they collect all the payroll taxes, throwing your account into disarray as you bounce checks to suppliers and even employees. They will levy your customers and have those customers send outstanding balances directly to the IRS rather than to you.
If you owe the IRS more than $20,000 in payroll taxes, are receiving past due notices and cannot pay the IRS immediately, you should call the tax professionals at Demetriou, Montano, & Associates. (In addition, we can also help you with unpaid state payroll taxes.) For over 25 years we have been helping companies just like yours to resolve payroll tax problems with the IRS and state tax agencies.