Employment Taxes
- Withholding Taxes
- Social Security and Medicare Taxes
- Employer's Payroll Tax Liability
- State Employment Taxes
- Depositing Payroll Taxes
- Accuracy of Deposit Rule
- Employment Tax Payments With Return
- Federal Unemployment Tax (FUTA)
- Advance Earned Income Credit Payments
- Non-Employee Withholding Taxes
- Reporting Employment Taxes
- Household Employees
- Employment Tax Deposit Penalties
- Trust Fund Recovery Penalty
- Delinquent Employment Taxes
- Using a Payroll Service
More Tax Topics
- Business Structures
- Start-up Costs
- Depreciation
- Car Expenses
- Home Office Deduction
- Travel Expenses
- Hiring Workers
- Meals and Entertainment
- Retirement
- Top Tax Myths
- Per Diem Rates - IRS Publication 1542 Oct 2011 for Travel Within the Continental U.S (for employers who pay a per diem allowance to employees)
Quick Links
Hot Topics
Need Some Deductions for 2011?
Don't overlook these!
Updated for 2011
Delinquent Employment Taxes
Delinquent Employment Taxes
What Should You Pay First: Debts to Business Creditors or Taxes?
Anyone with integrity hates to stiff those good enough to extend them credit. However, sometimes you have no choice.
A temporary but serious cash shortage problem may push you into a situation of having to prioritize your cash disbursements for a while.
Should you ever find yourself in this situation, paying your employment taxes first is absolutely a top priority!
The penalties and interest for failing to pay your taxes, particularly employment taxes, generally far exceed the late fees and extra interest you may have to pay on past-due bills from your creditors.
For example, the penalty for failure to pay trust fund taxes is 100% of the tax liability!
Businesses have been known to fail because of the heavy burden of having to come up with sufficient funds to pay delinquent taxes that were left unpaid for long periods of time.
Each month, when paying your bills, make sure your tax liabilities are at the top of the list!
Paying Past Due Taxes
When paying past due taxes include a letter to the IRS, along with your payment, that indicates you want your payment applied to the trust fund portion (federal income taxes and the employee's share of FICA taxes) first.
Include in your letter and on your check the following:
- Your employer identification number (EIN)
- The type of tax
- For example, employment taxes are referred to as 941 taxes and include federal income taxes, social security, and Medicare taxes (referred to as FICA taxes- the employer's and employee's share).
- The period covered
- For example, 4th quarter 2011.
In the memo area of your check write: Apply to trust fund portion.
Related Links
- What Are Payroll Withholding Taxes
- Who Pays Social Security and Medicare Taxes?
- Social Security and Medicare Tax Rates
- Wage Base for Social Security Taxes
- Employer's Liability for Employment Taxes
- State Income Taxes
- State Unemployment Taxes (SUTA)
- Employer's SUTA Experience Rate
- Unemployment Insurance Claims
- Depositing Employment-Related Taxes
- Nonpayroll Tax Deposits
- When to Deposit Employment Taxes
- When To Determine Your Employment Tax Deposit Schedule
- How to Determine Your Employment Tax Deposit Schedule
- How to Deposit Employment Taxes
- When an Insufficient Employment Tax Deposit May Not Cause a Penalty
- Payment of Employment Taxes With Form 941 (or Form 944)
- Who Pays Federal Unemployment Taxes (FUTA)?
- FUTA Tax Deposits
- When You Can Pay FUTA Taxes Annually With Form 940
- Payments Exempt from FUTA Tax
- What Are Advance Earned Income Credit Payments?
- Withholding Taxes and Advance Earned Income Credit Payments
- Advance Earned Income Credit Payments Treated as Tax Deposits
- Reporting Advance Earned Income Payments
- Taxes Withheld From Income Distributions Not Related to Employment
- Depositing Payroll Taxes versus Reporting Payroll Taxes
- Employment Tax Forms
- Employment Tax Forms Explained
- Zero Wage Return
- Schedule H, Household Employment Taxes
- Taxes Reported on Schedule H
- Schedule H and Form 1040
- Filing Extension and Schedule H
- Filing Schedule H When You're Not Required to File a Tax Return
- Federal Income Taxes for Household Employees
- IRS Employment Tax Penalty Refund Offer
- Employment Tax Deposit Penalties
- Order in Which Employment Tax Deposits Are Applied
- What Are Trust Fund Taxes?
- How the Trust Fund Recovery Penalty is Assessed
- Who is Responsible For the Trust Fund Recovery Penalty?
- Your Role When Using a Payroll Service
- What a Payroll Service Does
- State New Hire Registry
Copyright © 2008-2012 Larry Villano. All rights reserved.