Unpaid Payroll Taxes
Employers are required to collect employees' taxes by withholding a portion of each paycheck quarterly. Any balance collected and not paid to the IRS is overdue and instantly accrues penalties and interest. Sometimes this is a result of pure negligence. But more often, it’s a result of a business attempting to keep its doors open through a period when business is slow.
The IRS can shut down a business, sell off its assets, or seize assets while the business remains, trying to stay afloat. In fact, the IRS can levy a business’s bank accounts, and even the payments DUE to that business from other companies, such as suppliers, clients, or even insurance companies.
Penalties attributed to failure to pay Payroll Tax to the IRS are called Civil Trust Fund Penalties. They can be as high as $10,000.00 even in very ordinary cases.