Payroll Tax


It starts by missing a single tax deposit. No biggie, you’ll make it up with the next one. The next deposit date rolls around and you miss that one too. But that’s okay, because you’re going to have the money in a couple of weeks. Things come up, weeks turn to months and you have a growing tax liability on your hands. It’s a common story. We hear it every day.

We understand that things happen, especially in business. The IRS? Not really. It’s not that the IRS doesn’t understand this, it’s more that they just don’t care that much. But they do care about tax collection. Since M&M is a small, owner-operated company, we understand the challenges facing small business owners; and of course, we know tax collection. We understand them both very well.


IRS Trust Fund Tax


It may take the IRS some time to catch up with your missed payroll taxes, but once it happens, you’ll definitely feel it. Employment tax, or payroll tax, is considered a Trust tax by the IRS. As an employer, it is your duty to withhold your employee’s tax and turn it over to the government in the form of a tax deposit. When you don’t, the IRS considers this a type of theft because your employees’ tax money never made it to the government. However, your employees still get credit for the tax they’ve had taken from their paycheck.

So it’s bad enough that the IRS believes you stole your employees’ withholding, Social Security and Medicare tax money. They are also going to issue refunds to your employees for the withholding tax that was never received. That’s a double hit to the IRS and they’re angry about it. The Service, and the Revenue Officer charged with collecting the tax debt on behalf of the government, wants you to pay the debt as soon as possible. Liquidate business assets, personal assets, refinance, draw from a line of credit, borrow from friends and family, put it on a credit card, sell you’re first born… it doesn’t matter much to the IRS.


Personal Responsibility


The IRS will assess a large portion of the business payroll tax liability to the responsible individuals of the business – officers, shareholders, partners, members, employees, check signers.  Whomever the Revenue Officer deems willful and responsible for the business tax responsibilities.  This portion of the tax is called the Trust Fund Recovery Penalty.

You also need to be aware that a responsible individual that doesn’t pay his or her own employment tax and then files a personal tax return taking credit for the taxes as if it were paid, can be charged criminally by the IRS.


The IRS has Professionals Working for Them. Shouldn’t You?


So why would you talk directly to the IRS Revenue Officer that already believes you are guilty of stealing your employees’ tax money? Do you really think that you can say something that will change their mind? It’s a wise choice to retain a representative and M&M is the right choice. Once you engage M&M, your licensed tax team will handle all contact and communication with the IRS and state taxing authorities on your behalf. You feed us the information/documents we need and go back to running your business.

Believe me when I say the IRS has a system in place to collect your tax debt as quickly as possible. You need to be able to push back. The M&M Tax Resolution System has been developed since 2005 to resolve employment tax debts in the best interest of our clients, while working within the context of the IRS collection laws. Contact us today to find out how our Tax Resolution System can work for you and your business.

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