2006-11-04 06:39:54 · 4 answers · asked by angel_rat_83 1 in Business & Finance ➔ Taxes ➔ United States
Because the money that is being deposited is withheld from employees pay. It is not money that belongs to the employer any longer and the IRS does not want the business doing anything to put money at risk that is not theirs.
2006-11-04 06:54:43 · answer #1 · answered by waggy_33 6 · 2⤊ 0⤋
Because each month employers deposit 941 taxes with their banks. These taxes are not "reconciled" with the actual tax liability in the IRS records until the quarterly 941 Report is filed. After the report is filed, the IRS will assess penalties and interest if they discover that any of the tax deposits were shorted or paid late.
In addition, when W2s & W3s are filed in January, the Social Security Administration matches up their records with IRS 941 records to make sure that the wages and taxes reported on the W2s match the wages and taxes filed on the 941s.
2006-11-04 18:42:32 · answer #2 · answered by fearslady 4 · 0⤊ 0⤋
As stated previously, most of the money has been withheld from employees' pay (it does not belong to the business). Some of the money the business owes (their part of the social security and medicare tax--businesses pay 1/2).
The tax system is a "pay as you go" system. Which means the money is to be paid/deposited with the IRS as the income is earned (so they can hold/invest it). If they do not get to hold/invest it, they charge interest and penalty to make up for their lost time/investment income.
Also, if employers do not deposit timely, and W-2 information does not match what has been paid in, employees will experience problems when they file their taxes at year end.
2006-11-04 15:36:33 · answer #3 · answered by Anonymous · 1⤊ 0⤋
Because they can be, there are no watch dogs on what they do and they have ultimate power unless you can get a good lawyer and a court ruling against them.
2006-11-04 14:42:33 · answer #4 · answered by The Druid 4 · 0⤊ 0⤋