What did he do?\u00a0<\/strong><\/h3>\nMr. Morrison withheld Federal Income, Social Security, and Medicare taxes from his employees\u2019 paychecks,\u00a0 but FAILED to send the money to the government. Let’s not call it a failure. That sounds like a mistake. He just didn’t do it.\u00a0<\/span><\/p>\nAnywho, Mr. Morrison withheld the money from the paychecks. Instead of paying it to the government the way he was supposed to, he decided to use the tax money for his personal expenses.\u00a0\u00a0<\/span><\/p>\nHe stole from the government and his employees<\/strong><\/h3>\nWe already know that not turning the money over to the government is wrong, but what EXACTLY<\/strong><\/em> is the problem? When employees file their tax returns, they will either be due a refund or they will have a tax liability reduced by the amount of tax paid through withholdings. The government will issue a refund on tax money they never received. In the case of a tax liability, the Treasury Department is assuming they have a certain amount already in the treasury from withholdings. The taxpayer to pays the balance, and the government is short. We pay into the Social Security system and expect to be able to withdraw from it when we reach retirement age. Imagine submitting for Social Security only to find that you have no credits. Either way, the math ain\u2019t mathing!<\/span><\/p>\n![\"\"](\"https:\/\/etstaxrelief.com\/wp-content\/uploads\/2022\/07\/math-aint-mathin-min.gif\")
<\/span><\/h1>\nTrust Fund Taxes<\/strong><\/h3>\nTaxes withheld from an employee\u2019s paycheck are called Trust Fund Taxes<\/strong>. Trust Fund Taxes consist of Federal Income Tax, Social Security Tax, and Medicare Tax – what we commonly call payroll taxes. An employer has the added responsibility of withholding taxes from the employee\u2019s paycheck and sending the money to the Treasury at the prescribed time. The taxes are called Trust Fund Taxes<\/strong>, because they are held \u201cin trust\u201d until they are paid to the Treasury. Both the government and the employee are trusting<\/span> the employer to do that.\u00a0<\/span><\/p>\nEmployers must pay the employee\u2019s Trust Fund Taxes, along with the employer\u2019s portion of Social Security and Medicare taxes to the Treasury through the Federal Deposit System.\u00a0<\/span><\/p>\n<\/div>\n
Anywho, Mr. Morrison withheld the money from the paychecks. Instead of paying it to the government the way he was supposed to, he decided to use the tax money for his personal expenses.\u00a0\u00a0<\/span><\/p>\n We already know that not turning the money over to the government is wrong, but what EXACTLY<\/strong><\/em> is the problem? When employees file their tax returns, they will either be due a refund or they will have a tax liability reduced by the amount of tax paid through withholdings. The government will issue a refund on tax money they never received. In the case of a tax liability, the Treasury Department is assuming they have a certain amount already in the treasury from withholdings. The taxpayer to pays the balance, and the government is short. We pay into the Social Security system and expect to be able to withdraw from it when we reach retirement age. Imagine submitting for Social Security only to find that you have no credits. Either way, the math ain\u2019t mathing!<\/span><\/p>\n Taxes withheld from an employee\u2019s paycheck are called Trust Fund Taxes<\/strong>. Trust Fund Taxes consist of Federal Income Tax, Social Security Tax, and Medicare Tax – what we commonly call payroll taxes. An employer has the added responsibility of withholding taxes from the employee\u2019s paycheck and sending the money to the Treasury at the prescribed time. The taxes are called Trust Fund Taxes<\/strong>, because they are held \u201cin trust\u201d until they are paid to the Treasury. Both the government and the employee are trusting<\/span> the employer to do that.\u00a0<\/span><\/p>\n Employers must pay the employee\u2019s Trust Fund Taxes, along with the employer\u2019s portion of Social Security and Medicare taxes to the Treasury through the Federal Deposit System.\u00a0<\/span><\/p>\nHe stole from the government and his employees<\/strong><\/h3>\n
<\/span><\/h1>\nTrust Fund Taxes<\/strong><\/h3>\n