What happens when you owe the IRS, but continue to make payments to them? These are 941 payroll taxes and its about $65,000.00
2007-05-25 18:02:37 · 5 answers · asked by choicetx 2 in Business & Finance ➔ Taxes ➔ United States
The payments that you are making are being applied to the employer's portion of the 941 taxes. After the employer's portion is paid in full, the payments will start to reduce the trust fund portion, the part of the tax attributable to taxes withheld from employees. If you default on the payments, the IRS will commence an investigation to determine who the responsible officers of the employer were and will assess the unpaid trust funds against each of the responsible officers. Usually, officer A denies liability and rats out B and C. Officer B denies liability and rats out A and C. The IRS assesses the trust fund liability penalty against each based on the declaration of the other two. About $32,500 of the $65,000 will be trust fund taxes, more or less.
The IRS will not think criminal under these circumstances unless there is a pattern among the responsible persons to run up 941 liabilities in successive corporations. The IRS does not employ ghouls to steal your organs. The IRS will keep your refunds and may levy bank accounts if you default on your payment plan.
2007-05-26 23:06:26 · answer #1 · answered by mattapan26 7 · 0⤊ 0⤋
Since the 941 taxes were withheld from your employees' wages, if you didn't remit them to the IRS when they were due they will come after you hard. This is basically theft.
$65,000? What were you thinking?! There will be interest and penalties in addition to the original amount due. If you don't get it paid quickly, expect levies on your assets, and possible criminal prosecution.
2007-05-26 03:07:10 · answer #2 · answered by Judy 7 · 0⤊ 0⤋
The IRS takes an extremely dim view on failure to pay withholding taxes. Expect vigorous collection action on their part. Even though you may be on a payment plan they will still capture any tax refunds that you may have coming. They will also slap tax liens on anything and everthing you own to ensure payment of the debt.
2007-05-25 18:59:50 · answer #3 · answered by Bostonian In MO 7 · 2⤊ 0⤋
They will add penalties upon that $65k. But even worse, if they come after you, you will go to jail for collecting and not turning it over to them.
2007-05-25 20:39:16 · answer #4 · answered by Nifty Bill 7 · 0⤊ 0⤋
Everything imaginable; up to the harvesting of your internal organs for sale to transplant surgeons. Oh, oh! I shouldn't have said that.
2007-05-26 04:56:19 · answer #5 · answered by acmeraven 7 · 0⤊ 0⤋