12 April 2019 IRS announces criminal charges for employment tax compliance issues uncovered in two-week campaign In IR-2019-71 the IRS announced that a two-week employment tax compliance campaign resulted in penalties and criminal charges. The national program involved IRS visits to nearly 100 businesses that showed signs of potential serious noncompliance with the federal employment tax requirements. The IRS explained that employment taxes collected and paid by employers account for 72% of all revenue it collects and noncompliance by employers is the biggest problem for the federal tax system. For this reason, payroll taxes are a priority area for the IRS and this is why the IRS Field Collection and IRS Criminal Investigation (CI) undertook a special campaign during a two-week period between March 25 and April 5. During the two weeks, business owners were informed about ways to get current with back payroll taxes and were informed of the potential for civil and criminal penalties such as the Trust Fund Recovery Penalty wherein responsible parties can be held liable for 100% of the payroll taxes they fail to withhold and pay over to the IRS. As a result of this campaign, IRS CI indicted 12 individuals, executed four search warrants and saw six individuals or businesses sentenced for crimes associated with payroll taxes. In addition to these early numbers, roughly two dozen more enforcement actions are planned in the weeks following the two-week campaign. "Employers know the rules — they must deposit and report employment taxes accurately — this is non-negotiable," said Don Fort, Chief of IRS Criminal Investigation. "When employers fail to pay over the required employment taxes for whatever reason, they skip out on one of their most important responsibilities as a business owner. Not only are those employers cheating the system and their employees, they are cheating future generations relying on those taxes to help build the future." The IRS has several tools to bolster payroll tax compliance, including educational outreach, data analytics, and civil investigations by highly trained revenue officers, as well as harsher measures such as lawsuits, seizures and criminal referrals to IRS CI. More resources on complying and managing employment taxes and IRS CI can be found on IRS.gov.
Document ID: 2019-0772 | |||||||
