Payroll Tax Problems
Payroll tax problems can quickly become one of the most serious tax issues a business owner faces.
When a company falls behind on federal employment taxes, the IRS may pursue the business for the unpaid liability while also investigating whether certain individuals may be personally responsible for portions of the unpaid trust fund taxes.
Fair Tax Solutions helps business owners address IRS payroll tax debt, unpaid employment taxes, missed payroll tax deposits, delinquent payroll tax returns, and related IRS collection issues.
Why Payroll Tax Debt Is Different
Employers are responsible for withholding certain taxes from employee wages and sending those funds to the government along with applicable employer taxes.
A portion of these taxes is considered trust fund tax because the employer holds money withheld from employees before it is deposited with the U.S. Treasury.
When those funds are not properly deposited, the IRS may take the matter especially seriously.
For business owners, officers, employees, or other individuals with sufficient responsibility and authority over the company’s finances, unpaid trust fund taxes can potentially create personal exposure through the Trust Fund Recovery Penalty.
This is one reason payroll tax problems should be addressed quickly and strategically.
Unpaid Form 941 and Employment Tax Problems
Payroll tax problems can develop for many reasons.
A business may experience cash-flow shortages and begin using funds intended for payroll tax deposits to cover operating expenses. Required Form 941 returns may go unfiled. Deposits may be made late or inconsistently. A company may also discover errors from prior periods that have grown into a larger IRS liability.
Whatever created the problem, simply making occasional payments may not resolve the underlying compliance issue.
Fair Tax Solutions can review the business’s filing history, IRS account information, tax balances, notices, and current operating situation to determine what needs to be addressed.
If required business tax returns are missing, resolving those delinquent tax filings may be part of getting the business back into compliance.
Trust Fund Recovery Penalty Concerns
One of the most significant risks associated with unpaid payroll taxes is the possibility of a Trust Fund Recovery Penalty, commonly called the TFRP.
The IRS can investigate individuals who had responsibility for collecting, accounting for, or paying trust fund taxes and who willfully failed to do so. When assessed, the penalty can create personal liability for the unpaid trust fund portion.
This means a business payroll tax issue can potentially become a personal tax collection problem for responsible individuals.
If the IRS is conducting interviews, requesting financial information, proposing a TFRP assessment, or sending escalating notices regarding employment tax debt, it is important to understand what is happening before responding.
Resolving Payroll Tax Debt
There is no single solution that applies to every payroll tax case.
The appropriate strategy depends on the amount and type of tax owed, whether the business is still operating, whether current deposits are being made, whether returns are filed, the financial condition of the company, and whether personal liability is being considered.
Some businesses may qualify for a payment arrangement. Others may need a broader collection strategy. The first priority is often stopping the problem from continuing by getting current tax filings and deposits back on schedule.
Fair Tax Solutions can review the available IRS tax resolution services and determine which options may apply to the business’s circumstances.
If a payment arrangement is appropriate, our IRS installment agreement page explains how structured payment plans can work for qualifying taxpayers.
Payroll Tax Help for Businesses Nationwide
Fair Tax Solutions works with small businesses and business owners throughout Georgia and across the United States.
We serve clients throughout Marietta, Atlanta, Woodstock, Kennesaw, Roswell, Smyrna, Alpharetta, Sandy Springs and surrounding Georgia communities while also providing nationwide IRS tax help.
Payroll tax problems are not limited by geography, and many IRS matters can be addressed through remote communication and representation.
Do Not Let Payroll Tax Problems Continue to Grow
Falling behind once can become a pattern quickly. As new payroll periods occur, additional deposits and returns become due, potentially adding new liabilities to an already difficult situation.
Addressing the problem means looking at both sides of the issue: resolving the existing IRS debt and creating a plan to keep current payroll tax obligations compliant going forward.
If your business is facing unpaid payroll taxes, delinquent Form 941 returns, IRS collection notices, or concerns about personal responsibility for employment taxes, Fair Tax Solutions can help you understand what options may be available.
Speak with Fair Tax Solutions about your payroll tax situation.
