taxes: How the Trust Fund Recovery Penalty can impact your business
- 11/09/21 06:33 PM
It is incumbent on business entities with employees on its payroll, to withhold certain taxes from their employees' pay. For example, such taxes are the employer's portion of Social Security and Medicare taxes. When employers fail to remit these withholdings to the Treasury, for whatever reason, the penalties can be severe. The taxes withheld from employees' pay is held "in trust" for payment to the Treasury. The Trust Fund Recovery Penalty (TFRP) is a tool the government uses to pursue collection of the unpaid trust fund portion of payroll tax against third parties. The TFRP is used to collect these amounts from … (3 comments)
It is incumbent on business entities with employees on its payroll, to withhold certain taxes from their employees' pay. For example, such taxes are the employer's portion of Social Security and Medicare taxes. When employers fail to remit these withholdings to the Treasury, for whatever reason, the penalties can be severe.
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