Payroll Taxes

Employers are required to withhold employment taxes from their employees’ payroll and pay over to the IRS this owed “Trust Fund Tax.” When small business owners are unable to meet the IRS obligations, a Trust Fund Tax liability is created. The IRS is aggressive in enforcement of Trust Fund Taxes, and does not allow Trust Fund Tax to be discharged in a bankruptcy, no matter how old the tax liability is. This means that if you owe delinquent Payroll Tax, you must address the liability and find a solution. Given the complicated nature of Payroll Tax/Trust Fund Tax, call our supervising Tax Attorney to discuss your options and find the best course of action to resolve the tax liability.

The IRS reports that approximately 2 million businesses owe almost $50 billion in Payroll Tax. The IRS is increasing its enforcement actions, so the probability of facing a lien, levy or other action may be increasing. To determine if you may have a Trust Fund Tax Liability, there are two primary determinant tests: (1) whether you are “responsible” for collecting or paying withheld income and employment taxes, or for paying collected excise taxes; and (2) whether you “willfully failed” to collect or perform your obligations.

Typically, the IRS has the right to take enforcement action against anyone who meets these determinant tests, even if they were not an officer or employee of the corporation which originally collected the payroll taxes.

Call us if you need help resolving your payroll tax debt at 1-800-455-6829.