Payroll Tax Fraud Attorney - Federal Lawyer

Payroll Tax Fraud Attorney

Experienced Counsel for Federal Payroll Tax Fraud Matters Involving the IRS and DOJ

Alina Veneziano
Attorney Alina Veneziano
Payroll Tax Fraud Attorney & CPA Team Lead
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Nick Oberheiden
Attorney Nick Oberheiden
Payroll Tax Fraud Attorney Team Lead
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Federal payroll tax compliance is a concern for employers of all sizes. Employers must properly calculate, withhold, and remit their employees’ FICA taxes, and they must accurately report and pay their own federal payroll tax liability as well. Payroll-related tax law violations can expose employers to substantial penalties—and, in many cases, they can expose owners, executives, and other personnel to substantial penalties as well.

At Oberheiden P.C., we provide effective legal representation for federal payroll tax fraud matters. We represent employers during federal tax audits, and we represent both companies and individuals during criminal payroll tax fraud investigations and prosecutions. If you need to respond to the Internal Revenue Service (IRS), IRS Criminal Investigation (IRS CI), or the U.S. Department of Justice (DOJ), our federal tax fraud lawyers can use their experience to help resolve the matter as efficiently and favorably as possible.

Matters We Handle

We handle all types of federal payroll fraud matters involving the IRS, IRS CI, and DOJ. These can be high-stakes matters for both companies and individuals, so an informed and strategic approach is key. Within our federal tax practice, our payroll fraud tax attorneys represent clients in connection with:

IRS Payroll Tax Audits

The IRS regularly audits employers for federal payroll tax compliance. If your company is facing an audit, a federal tax fraud attorney from our firm can work with the IRS on your company’s behalf to affirmatively demonstrate compliance and proactively resolve any issues as necessary.

IRS CI Payroll Tax Fraud Investigations

IRS CI investigates companies and individuals suspected of engaging in intentional payroll tax fraud. Federal payroll tax fraud investigations can lead to a variety of criminal charges, all of which carry substantial fines and terms of imprisonment.

Employee Retention Credit (ERC) Claims

The Employee Retention Credit (ERC) was a pandemic-era credit designed to encourage employers to maintain their payroll despite the economic challenges of the time. Ultimately, however, it proved to be a prime target for fraud, and now the IRS, IRS CI, and DOJ are working together to uncover and prosecute fraudulent ERC claims.

Trust Fund Recovery Penalty (TFRP) Cases

Owners, executives, and other individuals accused of having direct involvement in payroll tax fraud can face liability for the federal trust fund recovery penalty (TFRP). If you are under investigation, or if the IRS has assessed a TFRP against you, it is important that you speak with a federal tax fraud lawyer right away.

Federal Charges for Payroll Tax Fraud

We also represent companies and individuals facing federal charges for payroll tax fraud. As former DOJ prosecutors, many of our attorneys are extremely well-versed in the DOJ’s enforcement priorities and procedures. Again, these are extremely high-stakes matters, so it is important to engage experienced defense counsel as soon as possible.

Put our highly experienced team on your side

Dr. Nick Oberheiden
Dr. Nick Oberheiden

Founder

Attorney-at-Law

Lynette S. Byrd
Lynette S. Byrd

Former DOJ Trial Attorney

Partner

Brian J. Kuester
Brian J. Kuester

Former U.S. Attorney

Amanda Marshall
Amanda Marshall

Former U.S. Attorney

Local Counsel

Joe Brown
Joe Brown

Former U.S. Attorney

Local Counsel

John W. Sellers
John W. Sellers

Former Senior DOJ Trial Attorney

Linda Julin McNamara
Linda Julin McNamara

Federal Appeals Attorney

Aaron L. Wiley
Aaron L. Wiley

Former DOJ attorney

Local Counsel

Roger Bach
Roger Bach

Former Special Agent (DOJ)

Chris Quick
Chris J. Quick

Former Special Agent (FBI & IRS-CI)

Michael S. Koslow
Michael S. Koslow

Former Supervisory Special Agent (DOD-OIG)

Ray Yuen
Ray Yuen

Former Supervisory Special Agent (FBI)

Common Allegations in Federal Payroll Tax Fraud Cases

When facing an audit, investigation, or federal criminal charges, it is critical to have a clear and comprehensive understanding of the issues involved. This is the only way to make informed and strategic decisions about your (or your company’s) defense. When you engage Oberheiden P.C., our payroll tax fraud lawyers will work quickly to assess all potential allegations. Depending on the circumstances, these may include (but won’t necessarily be limited to):

  • Failure to Collect Payroll Taxes – Employers generally have an obligation to collect the employee’s share of federal payroll taxes from their workforce. Failure to collect payroll taxes can lead to allegations of payroll tax fraud.
  • Failure to Remit Payroll Taxes – Employers must also timely remit all payroll taxes held in trust to the IRS. Failure to timely remit employees’ funds to the IRS can lead to imposition of the trust fund recovery penalty, and it can lead to criminal prosecution in some cases.
  • Payroll Tax Accounting Violations – When collecting and remitting employment taxes, employers must properly account for their employees’ funds. Employers must also ensure that they do not use their employees’ funds for other purposes. Improper payroll tax accounting is a common issue in federal payroll tax fraud audits and investigations.
  • Paying Employees in Cash – While not inherently unlawful, paying employees in cash is a common means of payroll tax fraud; and, as a result, it is a red flag for the IRS, IRS CI, and the DOJ.
  • Misclassifying Employees as Independent Contractors – Improperly classifying employees as independent contractors is another common means of payroll tax fraud. If the IRS or DOJ is accusing your company of misclassifying its workforce, our payroll tax fraud attorneys can intervene and work to steer the audit or investigation toward a resolution that avoids civil or criminal liability.
  • Filing False Payroll Tax Returns (or Data) – Allegations of filing false payroll tax or submitting falsified payroll data to the IRS will lead to criminal charges in many cases. We represent companies and individuals in cases involving allegations of payroll tax fraud, ERC fraud, Paycheck Protection Program (PPP) fraud, and other fraudulent practices.
  • Claiming Fraudulent Payroll Tax Credits and Deductions – Allegations of claiming fraudulent payroll tax credits (including the ERC) and deductions can expose companies and individuals to criminal prosecution as well. Here too, a proactive defense strategy is essential for avoiding unnecessary consequences.

Why Choose Oberheiden P.C. for Federal Payroll Tax Fraud Defense?

If your company is facing a payroll tax audit or payroll tax fraud allegations (or if you personally are facing payroll tax fraud allegations from the IRS or DOJ), why should you choose Oberheiden P.C.? Here is what you can expect when you engage our federal payroll tax fraud lawyers:

  • Immediate Advice and Representation – If necessary, our lawyers can get to work immediately. We can intervene in any pending audit, investigation, or prosecution, and we can quickly assess your company’s (or your) exposure so that you can begin making informed decisions.
  • Proactive and CostEffective Defense – We focus on providing proactive and cost-effective defense. Generally, these go hand-in-hand. We seek to protect our clients without litigation whenever possible, working collaboratively with the IRS (and DOJ when necessary) to find resolutions that protect our clients from unnecessary exposure.
  • Focus On Avoiding Federal Criminal Charges – We also focus on helping our clients avoid federal criminal charges. Payroll tax fraud is a serious allegation, and keeping criminal penalties off of the table can be a key step toward securing a favorable outcome.

FAQs: Avoiding Penalties for Federal Payroll Tax Fraud During Audits and Investigations

What Are Federal Payroll Taxes?

Federal payroll taxes include employees’ income taxes and the employee’s share of Social Security and Medicare. Under federal law, employers generally have an obligation to withhold payroll taxes from their employees’ paychecks, and employers must hold these funds in trust until remitting them to the IRS. Typically, employers must remit trust funds to the IRS on either a monthly or semi-weekly schedule.

When Are Companies Required to Collect Payroll Taxes from Their Employees?

Companies are required to withhold payroll taxes at the time of issuing their employees’ paychecks. To determine how much to withhold, companies must collect W-4 forms from their employees—in addition to applying the relevant provisions of Subtitle C of the Internal Revenue Code.

When Are Companies Required to File a W-2 with the IRS?

Companies that withhold payroll taxes from their employees must file a W-2 with the IRS annually. W-2 forms are generally due at the end of the year. Failure to timely file a W-2 with the IRS is among the most common triggers for federal payroll tax fraud audits and investigations.

What Are the Penalties for Federal Payroll Tax Fraud?

The penalties for federal payroll tax fraud depend on the circumstances involved. In civil enforcement matters, companies can face penalties calculated as a percentage of the payroll taxes that they underreported or underpaid. In criminal payroll tax fraud cases, companies can face six or seven-figure fines, and individuals can face both fines and prison time. Individuals accused of payroll tax fraud can also face liability for the trust fund recovery penalty (TFRP).

What is the Trust Fund Recovery Penalty (TFRP)?

The trust fund recovery penalty (TFRP) is a civil penalty imposed by the IRS against “responsible persons” who are accused of participating in or facilitating payroll tax fraud. Responsible persons may include company owners, executives, and directors, among others. To impose the TFRP, the IRS must find that a responsible person either: (i) was, or should have been, aware of a federal payroll tax violation; or, (ii) intentionally disregarded the law or was “plainly indifferent to its requirements.” The amount of the penalty is “equal to the unpaid balance of the trust fund tax.”


Speak with a Senior Payroll Tax Fraud Attorney at Oberheiden P.C.

If you would like to speak with a senior payroll tax fraud lawyer at Oberheiden P.C., we encourage you to contact us promptly. Our attorneys represent companies and individuals nationwide in complex federal tax matters. To schedule a complimentary initial consultation, please call 888-680-1745 ortell us how we can get in touch online today.

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