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Category: payroll tax

Behind on Payroll Taxes? Watch Out for IRS Letter 5857

8 March, 2025 | payroll tax

Summary 1. IRS Letter 5857 is sent to taxpayers who have fallen behind on their employment tax deposits, notifying them of an impending phone call from a Revenue Officer to discuss the issue. 2. The IRS prefers to resolve tax issues early and may offer payment arrangements or other relief options. 3. Ignoring the letter can lead to escalating collection efforts, including in-person meetings, liens, levies, and the Trust Fund Recovery Penalty (TFRP), which can hold in... CONTINUE READING

What is the IRS Failure to Deposit Penalty: How Can I Avoid It?

8 March, 2025 | payroll tax

Summary 1. The failure to deposit penalty is assessed when a company fails to collect and transfer payroll taxes, including federal income taxes, Social Security taxes, and Medicare taxes. 2. The penalty is based on the number of days the deposit is late and can range from 2% to 15% of the unpaid amount. 3. This penalty can add up quickly, especially if it’s part of an ongoing issue with late or missed deposits. 4. The IRS also charges interest on penalties... CONTINUE READING

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New York State Tax Debt—Collection Statute of Limitations

Statute of Limitations on NY State Tax Debt—How Long Can They Collect? After state taxes have been assessed, the Department of Taxation and Finance (DTF) can only collect taxes for a set period of time. In New York State, the statute of limitations is generally 20 years. Howe...