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Employment Tax Rules Violation Penalties and Solutions

You can be penalized if fail to deposit, report or pay taxes in time. These penalties can be in different shapes. Taxpayers are needed to be treated equally and justifiably. The people should be penalized only on the basis of sound analysis. The potential penalties are as follows: 
  • A penalty of 2%is imposed if employment tax deposit is 1 to 5 days late.
  • A penalty of 5% is imposed if employment tax deposit is 6 to 15 days late.
  • A 10% penalty is imposed if your deposit is 16 days late or more.
  • After receiving a notice, if you make a direct deposit within 10 days, 10% penalty is charged.
  • If you deposit after more than 10 days, 15% penalty is charged.
  • A 10% penalty applies if a deposit is made in an institution that is not authorized.
  • If you failed to file a return, 5% penalty of that return is charged. (up to 25% cap)
  • If taxes are not paid even holding income and required taxes, a penalty of 100% of tax due is imposed.
  • A person can go to prison for few years if deliberately does not pay employment taxes.
  • One can go to jail for one year if knowingly fails to file a return.
  • Submitting a false tax form can carry you to the jail for one year.
  • A person is responsible for the true information of employment taxes. If he/she knowingly submits a false document, can go to prison for years or face a financial penalty.

  • Consulting the accountant for handling the returns and backing up the measures accordingly. 
  • Mark the calendar well before the due date, to avoid the late filing of taxes. 
  • Ensure the accuracy of income documentation. Handle it throughout the year to avoid missing any source of income. 
  • One of the best ways to avoid employment tax penalties is back up and documentation. Keep your records updated. 
  • Before submitting the return, make sure the information provided is correct. 

Final words
It is very much possible to avoid these employment tax penalties. Using the right professionals to handle the critical tasks will also help. No need to hide anything, it can bring you to the trouble. Honesty is very important, don’t cheat and keep updated records of detailed information of your tax returns.