Understanding Your Payroll Tax
IRS payroll tax issues can be the downfall of many otherwise successful businesses. There are many businesses that still use the proceeds collected from taxes to pay their operating expenses instead of taxes. This can get you in trouble with the IRS very quickly.
The money collected from employees to pay their share of federal withheld tax, FICA and Medicare (Social Security) does not belong to the business and must be accounted for and paid to the government. Generally, one must make a federal deposit (by a payroll tax filing service, phone, or in person at a bank) three days after the pay date of the payroll checks. If you are missing these payments, you will hear from the government.