An accounting firm is warning employers about a glitch at the Delaware Department of Labor that led to sharply worded noticesfrom the Internal Revenue Service.
Faw, Casson and Co., which has offices in Dover, Rehoboth Beach, and Ocean City, MD, reported in a releasethat Delaware employers have been receiving IRS notices over the last six months or more claiming unpaid payroll taxes from 2016.
“The issue stems from a failed file transmission between the Delaware Department of Labor’s Division of Unemployment Insurance (DDUI) and the IRS. DDUI has resubmitted the necessary information and is providing certifications of employer accounts. We have also responded (sometimes repeatedly) to the notices on behalf of clients, but to our knowledge, the IRS has yet to clear any of these cases,” Faw Casson reported.
Faw, Casson noted that the issue is compounded by the fact that some of the earliest notices have now been referred to the collections arm of the IRS.
“Recent notices have stated ‘This is a notice of intent to levy your property… If you don’t call us immediately to make payment arrangements or we don’t receive the amount due within 30 days of this notice, we may levy your property…’”.
“After months of increasingly threatening IRS letters, we are concerned that some Delaware employers may have paid these assessments out of fear, not knowing they are incorrect,” Faw Casson reported. The firm says payments should not be made on the 2016notices.
“There is no way to tell how long it will take to resolve this matter, but we wanted to make our clients aware that this is a systemic problem, and that we have been working closely with DDUI (state Labor Department) on your behalf. We are now escalating this problem to our federal delegation – Senator Carper’s and Senator Coons’ offices,” the release stated.
Faw Casson spokesperson Denise Vendricksaid the Central Delaware Chamber of Commerce and legislators are also working on the issue.
The Delaware Department of Labor and other Delaware CPA firms did not immediately respond to requests for comment.