Money troubles may excuse late payroll taxes.

Kiplinger Tax Letter, The, July, 1998

Money troubles may excuse delays in sending payroll taxes to IRS, a district court says. Rejects IRS' position that financial difficulties NEVER justify abating penalties for untimely payroll tax deposits, etc.

But this company doesn't qualify for a waiver of the penalties, even though withholdings helped it stay afloat and IRS was paid in full.

The firm failed to take other steps to save cash in the interim... kept paying rent to its president on a building he leased to the company, continued to pay his full salary and didn't rein in his expense account. Thus, lacks a basis for avoiding late penalties (Fran Corp., D.C., N.Y.).