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Various penalties could result from unpaid business taxes

On Behalf of | Aug 20, 2021 | Tax Debt

Georgia business owners have a lot on their minds at all times during the year. You may often feel overwhelmed by the number of responsibilities you have to take care of to keep your small business afloat, but you likely also feel a sense of accomplishment for running your own company. Still, certain matters can quickly get out of control if you do not address them properly, and your business taxes are one of them.

Unfortunately, taxes in almost any form are confusing to handle. Whether you only recently started your company or have been in business for several years, you may still have many questions about your tax obligations, when to pay and what happens if your tax matters are not kept in order. If, for some reason, you do fall behind on your business income tax, serious penalties could result.

Various penalties and accumulated costs

If your business falls behind on taxes, the penalties could hit you in many forms. In addition, the longer that the taxes go unpaid, the higher those financial penalties will become. As a result, if you cannot pay your business taxes when they are due, you could expect to see those penalties accumulate the longer the balances go unpaid. Some of the possible penalties you could face include the following:

  • Penalties for failure to pay
  • Interest accumulation on unpaid tax balances and on the owed penalties
  • Penalties for not providing accurate information
  • Penalties for failure to file

In addition to these financial penalties, the IRS could also impose other serious consequences, including placing a lien or levy on your assets in efforts to cover the outstanding tax debt. Fortunately, the IRS will send notice before taking such actions, so you would still have a chance to get your tax affairs in order before a lien or levy.

What can you do?

Though most people do not realize it, the IRS does have options for making tax-related payments in installments and for getting an extension on outstanding tax returns or balances. However, it is important to remember that even these options could come with late fees and interest penalties. Still, if you are struggling to pay your business income taxes, you may find it helpful to explore the relief options offered by the IRS in hopes of finding an option that suits your circumstances.