Shareholders, Officers, and certain employees can be held personally liable for a corporation’s failure to pay certain payroll taxes (the same can be true with persons involved with an L.L.C. or other type of business entity). Internal Revenue Code Section 6672 authorizes the IRS to assess personal liability against individuals who were “willful and responsible” for a business entity’s trust taxes that were “evaded, or not collected, or not accounted for and paid over.” This means that you, or anyone within your business, that the IRS determines to be willful and responsible for the corporation’s (or other entity’s) failure to pay certain taxes could be held personally liable.
Once the IRS has made a personal Trust Fund Recovery Penalty assessment against an individual, the IRS may begin to collect from that individual in addition to its collection efforts aimed at the underlying business entity. Thus, your individual assets, wages, and bank accounts are put into jeopardy.
At Fortress, we understand how important it is to protect your individual assets, wages, and bank accounts. Without them, it can be difficult, if not impossible, to provide the basics for yourself and your family. Therefore, we take Trust Fund Recovery Penalties very seriously.
The best way to resolve a Trust Fund Recovery Penalty is to avoid having it assessed in the first place. If a tax problem is caught early enough, we can oftentimes negotiate an agreement with the IRS whereby your business resolves its own liability. However, the longer your tax problem goes unresolved, the greater the chances that the IRS will look to you and whoever else they determine to be responsible for your company’s failure to pay taxes.
In the event that you have already been personally assessed or it is too late to prevent a personal assessment, immediate action is necessary. We are oftentimes able to convince the IRS not to touch your personal assets, wages, and bank accounts as long as an acceptable agreement on behalf of your company is negotiated quickly.