Payroll taxes can be a source of frustration for many small business owners. It's imperative business owners fully comply with IRS tax mandates to avoid the risk of substantial penalties and perhaps a criminal investigation. 

The accountants at Selph and Friday CPA, located in Texarkana, Texas, discuss three important industry secrets all small business owners should know about payroll taxes.

• Small Businesses are Targeted: Small businesses have developed reputations as tax evaders because they are the largest source of uncollected taxes. As a result, they are watched more closely by the IRS. The IRS pays special attention to small businesses after they request an employer identification number, during economic downturns, and when they hire seasonal employees.
• IRS Uses Aggressive Collection Tactics: If a business has past due payroll taxes, the IRS can aggressively pursue business owners to collect unpaid debt. Collection agents can padlock a business's doors without a court order and seize company equipment, causing the business to close. Small business owners should immediately pay any amount that is owed to avoid losing their business.
• Owners Could Face Criminal Penalties: Some small business owners may believe their companies are too insignificant for the IRS to notice, but this is not true. Even if a company owes only a small amount of money, the IRS can freeze its bank accounts, making it difficult for their small business to stay open. The IRS can also refer the case to the Department of Justice if they can prove the business owner intentionally did not file or pay their payroll taxes.