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Business Payroll Tax Resolution
Payroll Tax Problems Require Specialized Representation
Unpaid payroll taxes are among the most serious IRS collection matters. They involve both the business liability and potential personal liability for responsible individuals through the Trust Fund Recovery Penalty. Revenue-officer cases require direct, experienced representation.
Payroll taxes are not dischargeable in bankruptcy
The trust fund portion of payroll taxes — the employee withholding — is not dischargeable in bankruptcy and can be assessed personally against any responsible person who had authority over the business finances. Ignoring a revenue-officer assignment is one of the most costly mistakes a business owner can make.
Why Payroll Tax Cases Are Different
Payroll taxes consist of two components: the trust fund portion (employee income tax withholding and the employee share of FICA) and the non-trust-fund portion (the employer share of FICA and FUTA). The trust fund portion is held in trust for the government — using it to pay business expenses is a serious violation.
When a business fails to make federal tax deposits, the IRS typically assigns a revenue officer — a field collection agent — to the case. Revenue officers have broad authority to investigate the business, interview responsible persons, and recommend enforcement action including business closure.
The IRS can assess the Trust Fund Recovery Penalty (TFRP) against any individual who was responsible for collecting and paying over the trust fund taxes and willfully failed to do so. This converts a business liability into a personal one.
Payroll Tax Resolution Services
- Revenue-officer management and direct IRS representation
- Form 433-B (Collection Information Statement for Businesses) preparation
- Federal tax deposit compliance planning
- In-Business Trust Fund Express Installment Agreement (IBTF-IA)
- Trust Fund Recovery Penalty interview preparation and defense
- Responsible-person analysis and defense
- Business closure or restructuring analysis
- Asset-sale and lien-discharge coordination
- Coordination with bankruptcy and business counsel
- Payroll tax return preparation (Form 941, 940)
The In-Business Trust Fund Express Installment Agreement
For businesses with payroll tax liabilities under $25,000 that are current on federal tax deposits, the IRS offers the In-Business Trust Fund Express Installment Agreement (IBTF-IA). This allows the business to pay the liability over 24 months without a full financial statement, provided the business remains current on all future deposits.
Learn about installment agreementsRevenue Officer Assigned? Act Immediately.
Revenue-officer cases require direct, experienced representation. We manage the IRS relationship, protect your rights, and identify every resolution option available to the business and its owners.
No resolution strategy is recommended until we have reviewed your transcripts and financial position. Eligibility depends on your specific facts.