Journal of a Poor, Poor Accountant (Day 127) – The Payroll Tax Scam

Dear Diary,Today, I was bored at work.A Really bored.A I mean – surf-the-internet-looking-for-designer-handbags bored.A (And I don’t even like artist handbags…although I would not mind a )Anyway…it was Payroll Day, which usually I am happy about.A When payroll comes around, I take my sweet time entering all the timecards and wages.A I tell the supervisor it’s an all-day task, however in reality, I’m done before lunchtime.A I usually provide the checks in to his office around 4PM, thus I get the rest of the afternoon to screw around online.So there I was, browsing Bag, Borrow or Steal, when the secretary walked in.A I quickly switched the windows on my computer to show the payroll.A Ironically, it was my own check.”When do you consider the payroll checks will be ready?” the secretary asked me.”Why do you wanna know?” I asked in my many frustrated voice.She inched toward the door, clearly uncomfortable by my unwelcoming persona.A “It is just, I’ve to keep at lunch, and I’m going on holiday for the weekend.A I was kinda hoping to get that check before I left.””Oh.A Well then, I’ll place a rush on your paycheck,” I informed her.Her little ears actually turned pink with pleasure as she thanked me effusively and scooched out of my office.That was when I turned my focus back to the check and realized something.A I’d unintentionally changed my Federal tax reduction amount from $200 to $0.A I do not think I’d actually realized before that it was really easy to change the payroll taxes before reducing a was my Ah-Ha moment – like Oprah often shares about.A I realized in that moment, I could zero out my taxes to get more money with every paycheck, but then still pay the standard tax amount to the IRS each and every payday.A Then, at the end of the year, I could file my taxes and get a refund.A Even better, I could make my boss overpay the taxes on everybody every week and file the paperwork at the end of the year proclaiming that all of those extreme taxes were deducted from my paychecks alone, and then get an even larger refund.A If I could manage to make the regular payroll amounts the same every payday, the boss would not think to look twice at the money being deducted from the account.The problem now is:A how much can I get away with spending before the boss updates a Stop this Kind of Embezzlement:This is one of the sneakiest types of embezzlement, particularly because it’s common for a company to pay an of money in payroll taxes.A Also, it is common for bookkeepers to regulate individual government taxes for each pay period because often, it’s only the individual employee who would have to face the consequences – that of dealing with the IRS at the end of the year and trying to get a return or make up the difference.A The largest embezzlement chance happens when the final paperwork is filed at the end of the year – the paperwork that details out who compensated what in employee/employer taxes.A It’s on that paperwork where an embezzler can declare that they overpaid in their taxes and thus deserved to get ALL of that money back.Therefore, to find and prevent this type of embezzlement, you require to:1 )AAAAA Look closely at the individual taxes of the person who makes the paychecks.A (This should be on an attached paystub. )A Compare it to someone who makes approximately the same amount during that period.A Look to see if the tax amounts are very different or only slightly skewed.A A big difference will sometimes suggest that the two persons claim different breaks during the year, or that the tax amounts were overridden.2 )AAAAA Periodically, put up the individual taxes for all of the employees being paid.A Once you have a total tally, examine it to the cost that was built to the government.A (You should see this on the bank statement or charge card statement that was used to make the taxes. )A If the totals aren’t the same, then you undoubtedly have a problem.A That problem could be embezzlement, or it could just be that your bookkeeper is dyslexic.3 )AAAAA Finally, have someone other than the person entering the payroll fill out the final payroll tax paperwork at the end of the year.A Even though it’ll cost you more to pay an to do this, it could possibly save you hundreds in overpaid taxes that an will claim as a refund.A All you have to do is deliver a copy of your accounting file to your accountant, and then your accountant can take a closer look at anything that doesn’t look right.If you have any other recommendations on how to stop this type of embezzlement, please reveal it.A The only way to stop embezzlers from ruining the businesses they work with, is through teaching each other about how getting away with it.

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