How To Deal With Payroll Taxes
Employers are required to pay the payroll taxes at every single quarter
. This is being done through withholding the payroll taxes from the employee's paycheck. These taxes are paid to the Internal Revenue Service (IRS). Usually, the employers use form 941 and 940 to fill these taxes. If employers fail to pay these taxes on time, or avoid paying them due to some reason, then the company sustains a payroll tax liability.
The Internal Revenue Service (IRS) is quite strict about payroll taxes unlike the other taxes, if companies are late or avoid filing their payroll taxes. They are very persistent about collecting the past due amount. There are many companies who think that they can declare themselves bankrupt to avoid paying these taxes but the IRS does not allow any company to avoid paying payroll taxes as long as they are running their business.
When a company has to pay these taxes, one of the best alternatives is to come across a solution which will be agreeable to the company and the IRS. One of the finest ways to do that is through setting up a plan to pay the taxes. The IRS will not spare anybody from paying the payroll taxes whether you work in a corporation, are a stockholder, or are a member of the board of directors etc.
If employers avoid paying these taxes, then you will be penalized up to 25-percent, can lose your business and can also have your bank accounts frozen. This is one of the vital reasons that you have to settle with the IRS over paying your payroll taxes. One can try to negotiate with the IRS in terms of paying your taxes. Sometimes you can get away from paying the extra pennies on the dollar. Once you have paid the IRS you can pay the remaining amount you owe. Some employers set up an installment agreement wherein they can make monthly payments to these taxes till they make their final payment. If an employer fails to pay the taxes on time, then your tax liability can become your personal liability and the IRS calls a "Trust Fund Recovery Penalty which means you may have to acquire a debt for your business or are a part of that business.
One of the best options is to seek an advice regarding the payroll tax problem from a tax advisor, tax attorney, tax specialist or enrolled agent. A tax advisor, tax attorney, tax specialist or enrolled agent can guide you with all the possible solutions regarding your tax problem. They can even contact the IRS on your behalf so as to negotiate about your tax problem. If they are successful, then either you have to pay a lesser amount or else nothing at all.
One of the most important things to consider is to pay your taxes on time to stop the penalties and avoid any further trouble. One of the best ways to pay back your taxes is through installments which keeps the Internal Revenue Service (IRS) off your back. Always make the payment on time, or else the IRS can cancel your installment agreement and then you will have to pay the whole amount at once along with the penalties.
by: IRS Debt Repair
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