Payroll tax problems can be resolved but you must act quickly.
Do you owe back payroll taxes?
Scary, huh? This is a biggie! We know you didn’t do it on purpose. Life happens. Business downturns or unexpected bumps force you to make hard choices. Then you ended up in the dark place of having the IRS breathing down your neck. Something you never could have imagined when you joyfully started your business. But don’t worry, your payroll tax problems can be resolved.
Payroll tax liabilities are handled differently by the IRS than other tax obligations. Here are some things you should know:
- Getting compliant with current payroll tax obligations should be the first thing on your list. Don’t miss another payment. Cut back on your employee hours, cut your own salary, or do whatever you have to do to be able to make the payroll tax deposit every time you run payroll.
- Get into an installment agreement for the back tax liability. This can be very difficult as there are financial disclosure forms to submit and hoops to jump through, but it has to happen so your bank account is not levied.
- The IRS will likely assess what’s called “Trust Fund Recovery” penalties. These penalties are assessed to the individuals responsible for making the payroll tax deposits. There are potential ways around the assessment, but that gets very complicated.
The sooner you get a handle on this, the better!