Payroll Taxes withheld carry stiff penalities if not paid

Here’s why it’s critical for employers to comply with employment tax rules and pay the IRS what they collect from employees. In February, a Kentucky man was sentenced to 15 months in prison for willful failure to pay over federal income and employment taxes that he withheld from his employees’ paychecks over a period of several years. A Wisconsin CEO/CFO received an even harsher sentence, 33 months in prison, for not paying over to the IRS $850,000 in worker paycheck withholdings. And an Oklahoma business owner pled guilty to failing to pay more than half a million dollars in withheld employment taxes. The man hasn’t yet been sentenced but faces up to five years in prison.