When payroll taxes are not paid, the IRS takes immediate action. The IRS will look for payment from everyone who knew or should have known that the tax was not paid (i.e. the owner, board member, administrator, accounts payable person, among others who knew or should have known that the tax was not paid). The IRS will hold as many people personally accountable for the tax as possible. Every business with employees are required to turn over payroll taxes to the IRS on a set schedule. The employer holds the payroll taxes for the benefit of the government in trust until they are paid. The IRS acts quickly to recover these funds if they are not paid by the employer in a timely fashion. The IRS has broad latitude to collect these taxes that can put you out of business, sell off your assets and pierce the corporate veil, holding you personally liable if they can not get all the money out of the business. There are penalties and interest on top of the original trust fund to pay over to the IRS. Beyond that, there can be criminal prosecution for knowingly and intentionally failing to pay the taxes.
You need to take immediate action to find a resolution to payroll tax problems. Hopp Accounting & Tax Service can represent you before the IRS and guide you to find the right collection alternative based on the facts and circumstances of your case. Our tax attorneys, CPAs and Enrolled Agents can take immediate actions to work with the IRS for you.