What Are Employment Taxes?

Employment taxes are imposed for a variety of purposes such as social security tax, Medicare tax, unemployment insurance, and state disability programs. Some of these taxes are paid for by the employee, some by the employer, and sometimes both the employee and the employer make the ‘contribution.’ Employment taxes arise under both federal and state tax systems.

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What Happens if I Do Not Pay My Payroll/Employment Taxes to the Government?

It is the employer’s responsibility to withhold and match federal and state payroll tax amounts and file quarterly employment tax documents with the IRS, making all necessary payments for your employees and company. Failure to do so will initiate an investigation by the IRS. Should you refuse to pay, the IRS will file a formal prosecution recommendation. This means that the IRS is charging you with the crime of Employment Tax Evasion. At that point, a formal investigation has begun and fines and fees will start accumulating.

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