Why Does My Business Owe A Civil Penalty?The most likely answer is that the Social Security Administration (SSA) and IRS are missing your W2 and W3 forms for a certain tax year. If you haven't filed your W2s/W3 with the SSA, you're business is at risk of being assessed a Civil Penalty, which can run as high as $1,500,000 per year.
Will The IRS Remove My Business Civil Penalty?In my experience, the IRS is very liberal when it comes to abating Civil Penalties that have assessed to businesses. However, it is much easier to avoid the Civil Penalty assessment altogether than to request the removal of it. Prior to assessing the penalty, the SSA and IRS will send notices to the business advising of the missing documents and giving the business the opportunity to provide the completed forms.
My advice is that you always open your IRS notices and Letters, read them carefully and respond to them promptly. In this case, sending in your W2/W3 forms when requested will prevent a big headache and a bigger, avoidable tax debt down the road.