Businesses of all sizes are required to comply with state and federal tax regulations in order to avoid audits and penalties. However, even if you are the owner of a business, it doesn’t mean you are expected to run it on your own without any help.
For instance, you may know everything about your product, your clients and your capabilities, but that doesn’t mean you also know everything about the tax obligations you have as an employer. Without legal guidance, it can be easy to make some unwise decisions that ultimately have expensive consequences.
For example, a company that owns multiple donut shops in another state found itself in federal court recently after it allegedly failed to pay payroll taxes in full and on time. The courts determined that the company owed more than $645,000.
The court ruled that the company must pay delinquent federal payroll taxes, even though the company has since closed multiple stores. Should the stores open again and start operating, they will be required to pay their taxes on time.
This situation may be quite similar to those facing other businesses right here in Atlanta. A business may be struggling to stay open and make a profit and when those taxes are due, an owner may decide that filing tax returns and/or paying full payroll taxes is less of a priority than covering other expenses. It might seem like it’s not a big deal or that it will be a one-time thing that will hopefully get swept under the rug.
However, this decision can have enormous consequences. The federal government can come back at the owner and other responsible parties for payment. Tack on penalties and interest and the amount due can be much greater than what was to be paid originally.
In an effort to avoid these situations, Georgia business owners can consult an attorney to understand their rights and obligations when it comes to employment tax. If a problem does arise, then working with an attorney as soon as possible to address it can be an effective way of minimizing the potential consequences and protecting a business.
Source: WMDT, “UPDATE: Donut Connection ordered to pay payroll taxes,” Leanne Guyette, Feb. 4, 2016