Workers Comp Audits, Tax Evasion [and] You

 

During a Workers Compensation Audit your company's payroll be reviewed, scrutinized and ostensibly verified. Auditors look at company payroll because  your  Workers Comp premium is based [in part] on the amount of compensation paid to your employees. 

Employment Tax Evasion Schemes

 

Employment tax evasion schemes can take a variety of forms. Some of the more prevalent methods of evasion include pyramiding, employee leasing, paying employees in cash, filing false payroll tax returns or failing to file payroll tax returns.

 

Pyramiding

 

"Pyramiding" of employment taxes is a fraudulent practice where a business withholds taxes from its employees but intentionally fails to remit them to the IRS. Businesses involved in pyramiding frequently file for bankruptcy to discharge the liabilities accrued and then start a new business under a different name and begin a new scheme.

 

Employment Leasing

 

Employee leasing is another legal business practice, which is sometimes subject to abuse. Employee leasing is the practice of contracting with outside businesses to handle all administrative, personnel, and payroll concerns for employees. In some instances, employee-leasing companies fail to pay over to the IRS any portion of the collected employment taxes. These taxes are often spent by the owners on business or personal expenses. Often the company dissolves, leaving millions in employment taxes unpaid.

 

Paying Employees in Cash

 

Paying employees, whole or partially, in cash is a common method of evading income and employment taxes resulting in lost tax revenue to the government and the loss or reduction of future social security or Medicare benefits for the employee.

 

Filing False Payroll Tax Returns or Failing to File Payroll Tax Returns

 

Preparing false payroll tax returns understating the amount of wages on which taxes are owed, or failing to file employment tax returns are methods commonly used to evade employment taxes.

 

 

Tax Representation

 

Specializing in unpaid sales and payroll withholding tax problems. We represent individuals, businesses and entrepreneurs before the Internal Revenue Service and New York State Department of Taxation and Finance. Negotiating reasonable tax settlements and payment plans since 2006. Consultations are available in person or by telephone and emergency appointments are available upon request. To speak with a Federal Tax Practitioner CPCU and Attorney call (212) 974-3435 or contact us Online. 

 

Insurance Audits

 

Workers Compensation, NYSIF and General Liability Audit Representation. We successfully challenge large dollar premium assessments, employee misclassification, experience and other rating issues. Most premium disputes are settled within 60 days of our being retained. Assistance with insurance coverage, loss reduction and risk management services. Consultations are available in person or by telephone and emergency appointments are always available.