My Employer Didn’t Withhold Enough Taxes

If you work a normal job – a standard W-2 for the most part – then it is assumed that your employer will withhold your taxes to provide to the IRS. For most people, this means that your employer has held back enough money that you receive a nice little rebate from the IRS. If nothing else, it should guarantee that you do not owe the IRS a penny. Sadly, not every employer gets tax withholding correct!

This can leave you with a headache to deal with. If your employer has made this mistake, it will often come down to an administrative error on their part. It could also come down to a mistake with regard to things like Medicare and Social Security taxation being miscalculated.

Nine times out of ten, this is an innocent mistake. For example, your employer might have reported the wrong W-2 wages. This most commonly happens if you receive a pay increase during the tax year, and the employer needs to adjust this accordingly.

However, when you take a job, you might find that you provided inaccurate details concerning IRS Form W-4. It might even be as simple as your employer has misaligned you as an independent contractor instead of an employee.

Whatever the reason, it is very important that you take action and resolve the matter as soon as possible.

What do you do if your employer has not withheld the correct amount of tax

The first step is to make sure that you contact the IRS right away to resolve the matter. Unless your employer has misclassified you as an independent contractor, as noted above, you will likely need to resolve this matter on your own.

Many times, we hear from individuals incapable of making the full payment that the IRS is demanding. Put simply, they assumed they had paid their tax and had not withheld enough money to pay this surprise tax bill. The best way to resolve this is by contacting the IRS and offering an Offer in Compromise (OIC). This will settle the tax debt for a lower amount than was previously asked.

However, the most likely solution is that you can set up a smaller monthly payment option to pay this over a prolonged period. If you are unsure about what you should do or what your options are, reach out for our legal support today.

Your employer putting you in this position is unenviable, but it can be resolved with the right approach. As such, you should look over all of your available options beforehand. Acknowledge the issue with the IRS, and then contact us today to evaluate your next best step.

If you worry that your employer has made a major mistake on the amount of tax to be withheld, please contact us today for help. We can double-check the numbers with you and ensure that you can build a plan of action to resolve this issue. Even if your employer’s failure to withhold enough tax is not necessarily your fault, taking action ASAP can reduce the risk of penalties and problems with the IRS.

Leave a Reply

Your email address will not be published.

You may use these <abbr title="HyperText Markup Language">HTML</abbr> tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>