We Help Business Owners Deal with the IRS
Failing to pay payroll taxes can result in liability for especially severe penalties. This is a serious tax offense, and you can expect the IRS to treat it as such. Many people who actually owed payroll tax to the IRS have lost their businesses as a consequence of their debt.
There’s a lot at risk when the IRS says you own payroll taxes. When you are in a situation like this, you need legal counsel on your side that will advocate for your interests and protect you against unfair treatment by the IRS. You are in a vulnerable position when you are alleged to owe payroll taxes – get experienced help from a payroll tax lawyer in Memphis, like ours at Damiens Law Firm, PLLC.
We offer everyone a free initial consultation to learn more about how we may be able to help them with their unique situation. Schedule yours today by calling (601) 957-9672 or by contacting us online!
Payroll tax vs. employment tax
Because these terms are often used interchangeably, it’s important for every business owner to understand that they’re actually different despite being similar in some ways. While both refer to taxes on earnings, they differ in how they’re applied.
Payroll taxes are defined on IRS Form 941. They include the employee’s withheld contributions for federal and state income tax, Medicare, and Social Security. Employers are required to file Form 941 on a quarterly basis to ensure these withheld taxes are properly reported.
Employment taxes, on the other hand, are those that are directly paid to the IRS by the employer, and include the following:
- Federal income tax
- Social Security tax
- Medicare tax
- Taxes associated with the Federal Unemployment Tax Act
A payroll tax lawyer in Memphis like ours at Damiens Law Firm, PLLC can help you understand your tax liability as well as any potential consequences you may be facing. Reach out to us today for help!
Penalties for payroll tax noncompliance
One of the most important tasks a business owner has is to ensure their payroll taxes are properly collected, reported, and paid. As we previously mentioned, the IRS takes this matter very seriously and will not go easy on employers it suspects of violating payroll tax law.
The penalties for failing to report and deposit payroll taxes are structured according to how many days a payment is late:
- If payment is late by 1 to 5 days, then a 2 percent penalty is applied.
- If a payment is late by 6 to 15 days, then a 5 percent penalty is applied.
- If a payment is late by more than 16 days, then a 10 percent penalty is applied.
- If payment is not received 10 or more days after the first IRS bill comes, then a 15 percent penalty is applied.
On top of these penalties, you can owe interest on a tax deposit when you miss a deadline. The interest rate for these deposits can range from 3 to 6 percent.
Do you require legal assistance?
If you are dealing with a matter involving payroll tax debt, reach out to Damiens Law Firm, PLLC for help. Whether you actually owe money to the federal government or believe the IRS is mistaken in its scrutiny against you, our payroll tax attorney in Memphis can assist you. We can assess your situation and help you determine ways in which you can confront the IRS and resolve your issue.