Tax Attorney Brian T. Loughrin successfully helps taxpayers stand up to the IRS.
Payroll (941) Taxes are the most aggressively collected and penalized of all taxes. Without proper representation, Payroll (941) Tax problems can put you out of business. Tampa IRS tax audit lawyers from our office can help you solve this problem.
Sometimes circumstances beyond your control force you to make tough decisions. Sometimes it's a decision between paying your operating expenses or paying your Payroll (941) Taxes. It's a spot no business owner ever chooses to put themselves in, but it happens.
What Are the Penalties for a 941?
Federal Employment and Payroll (941) Tax delinquencies can result in the assessment of massive penalties & interest along with the seizure of your business and personal assets. Federal Payroll (941) Tax laws give the IRS greater authority to collect what is owed.
This authority includes the ability to collect these taxes from the owners and corporate officers. Even if the business is voluntarily or involuntarily closed, the owners/corporate officers are personally liable for these type of taxes - and Payroll (941) Taxes cannot be discharged in bankruptcy!
Payroll Taxes: The 100% Tax
Delinquent Payroll (941) Tax problems are full of obscene interest and penalty charges, such as:
- Penalty for filing a late return or corporate report.
- Penalty for making a late deposit or failing to make one.
- Interest on the delinquent taxes and interest on the penalties!
- Assessment of penalties that no one can seem to adequately explain to you.
Adding the above amounts together, it's easy to see why Payroll (941) Taxes are often called the 100% Tax. Penalties and interest added together can quickly equal 100% of the actual tax!
What Payroll Taxes do Employers Pay in Florida?
In Florida, employers will withhold 6.2% of your earnings for Social Security taxes and 1.45% of your earnings for Medicare taxes. Your employer will match that by contributing the same amount.
Note that if you’re self-employed, you’ll need to pay the self-employment tax, which is the equivalent of twice the FICA taxes - 12.4% and 2.9% of your earnings.
Half of those are tax-deductible, though. Earnings over $200,000 will be subject to an additional Medicare tax of 0.9%, not matched by your employer.
In recent years, the IRS issued some notable revisions for the Form W-4. Rather than asking you to list total allowances, the new W-4 uses a five-step process that allows filers to enter personal information, claim dependents and indicate any additional income or jobs.
The employee tax rate in Florida is 6.2% on wages up to the taxable wage limit of $127,200.00. The maximum Social Security tax that an employee would pay will be $7,886.40.
The Medicare Tax Rate Increases from 1.45% to 2.35% on wages earned over $200,000.00. The employer is required to withhold an additional Medicare tax at the point in the pay period when an employee’s annual wages exceed $200,000.00.
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