The President of a computer software development company was criminally charged by the Department of Justice on July 2, 2010, for failing to pay to the IRS his employee’s withholding from Social Security, Medicare and federal income taxes. Jon Eisenhower, the President of CoMangage, Inc., was indicted and faces a maximum of 75 years in prison and a maximum fine of $150,000.00 if convicted. The trial is scheduled to begin September 8, 2010.
Most business owners do not realize that failing to pay over withholding taxes is a crime punishable by imprisonment. Further, the business owner exposes himself to personal liability under the Trust Fund Recovery Penalty for failing to collect and pay over withholding taxes. For the same reason, the business is also at risk for IRS enforced collection action which can include the seizure of business assets, bank accounts and accounts receivable.
If you own or operate a business that has unpaid withholding taxes (Form 941), call Patrick T. Sheehan & Associates at 630-832-6500. We can help.