One of the biggest, and unfortunately most common, mistakes small business owners make is making late tax deposits and late filing of tax returns. The IRS brings in plenty of revenue from penalties, and interest generated from these mistakes. It is worth the time to set procedures in place to make sure that tax filing and deposit deadlines are met.
There are generally two different issues, which result in IRS penalties being imposed on small companies. One is the genuine unintentional missing of deadlines and the other results from spending funds that should have been set aside for tax deposits, particularly payroll tax deposits. We’ll address each separately.