Failing to pay payroll taxes causes severe penalties from the IRS. In fact, the IRS tends to view this kind of tax evasion as more serious than that of income tax evasion. Usually businesses don't pay employment taxes du e to financial hardship, but another reason a business may not be paying them is due to paying employees in cash. This isn't illegal unless the purpose behind it is to avoid paying taxes. The practice of not reporting cash payments is usually associated with employees, but it applies to employers, too. Here's what you need to know about cash payments so you don't end up with fines or even a jail sentence.
Atlanta-area small business owners understand the pinch that can come from having to pay employment or payroll taxes. A downturn in business or a financial emergency can affect your bottom line in a hurry, making it seem less crucial to send in regular payments to the government.