Sure, pretty much everyone who starts a company and hires employees knows about payroll taxes. Most people are familiar with these taxes from their own employment history and old paycheck stubs. Even when an employer doesn’t know every relevant detail and paycheck calculation, they either learn quickly or they hire an accountant. And yet, failure to pay payroll taxes is a much more common problem than you might think.
The annual tax gap, between what businesses and taxpayers owe the IRS and what they actually pay, runs around $400 billion each year. How much of this is employers not paying payroll taxes? About $72 billion per year, as reported by the Department of Justice.
Why Employers Do Not Pay Payroll Taxes
The biggest chunk of this problem isn’t big businesses trying to swindle the government out of money. Instead, a much bigger issue is failing or cash-strapped businesses that don’t have the money to pay, for one reason or another. Most often, the company collects the payroll taxes but then dips into these funds with the intent of replenishing the account before the quarterly payment comes due.
The stories run the gamut from owners lavishing friends and family with extravagant gifts to those who are just trying to keep the doors open and pay their employees for as long as possible. Regardless, these payroll tax liabilities don’t just go away, no matter how broke you may be and no matter how noble your business. This is one of those things that the IRS never forgets. An employer not paying payroll taxes is a recipe for long-term hassles and a financial hole you may never recover from.
Get the Software Support You Need for Last-Minute Payroll Taxes
It’s never a good idea to wait till the last minute to pay payroll taxes, but having an e-file software solution you can depend on can be a helpful resource in these stressful situations. Here’s the thing: You can’t wait till the last minute to start shopping around for a payroll software solution that fits with your business needs. Check out these AMS Payroll Software features and/or download our free demo to see what our software can offer your payroll and accounting services:
- Excellent for meeting all small business payroll software.
- Automatically calculate federal, state and local payroll taxes.
- State and Federal tax tables are updated as needed.
- Up to 40 User Defined Fields can be set up for deductions/additions such as 401K or Health Insurance.
- Processes Employee Direct Deposit payroll information, as well as over 30 different types of checks.
- Prints MICR checks – with Software Generated Forms.
- Supports Federal payroll forms such as the 941, 940, 943, 944 and 1040 Sch H. See complete forms list.
- Includes SUI forms for all 50 states, the District of Columbia See complete forms list.
- Supports all 50 states plus the District of Columbia
- Support for up to 1,999 payers and up to 9,999 employees per payer.
- Includes the ability to magnetically/electronically file 941, 944, and 940 forms as well as nearly 30 state quarterly returns.
- State and Federal Tax deposit information, as well as disbursements, can be recorded.
Buy our accounting software now, or talk to our Sales and Information team at (800) 536-1099.