You have worked hard all of your life, creating a business, serving customers, taking care of employees, and providing for your family. Suddenly, your business ran into a few bumps in the road, and money got a little tight. Then, it is time to make payroll, but you are short on funds to pay your employees' withholding taxes to the IRS. You can keep the business afloat, but it is at the cost of keeping the payroll taxes to run the business. The result: You fall behind on your IRS tax obligations. And that can be scary - your livelihood now being put up against the IRS collection ... Read More
How to stop an IRS trust fund recovery penalty interview
Your business owes the IRS employment taxes, and an IRS Revenue Officer has just called you and requested that you come down to his office for a meeting to discuss the debt. Chances are, the meeting will include the IRS agent requesting to interview you using IRS Form 4180, Report of Interview with Individual Relative to Trust Fund Recovery Penalty. You do not know it, but the real focus of the meeting is you, not the business. That's right, the IRS can collect an unpaid employment tax liability from not just your business, but you, too. The IRS calls this a trust fund recovery penalty ... Read More
IRS Investigations of Unpaid Employment Taxes: A Step-by-Step Guide
It’s an old story that the IRS combats everyday: When a business struggles and cash flow is tight, when there is not enough money to pay both rent and employment taxes, the IRS takes a back seat, and the business uses employee withholding taxes to keep the lights on. The result is that the IRS is made an unwilling lender to fund operations. Your hope is that the tide will turn and the IRS can be repaid before they come calling. Your business is your baby, but this is can be a dangerous bet, and as we will see, it is especially dangerous in employment tax cases. Liability for ... Read More
What to expect from the IRS if your business owes employment taxes: 10 tips
Unpaid employment tax liabilities results in the highest level of IRS enforcement. The IRS usually assigns its most experienced Revenue Officers to investigate employment tax cases, including pursuing the individuals in the business personally for not paying their employees taxes. If your business owes employment taxes to the IRS, what does this mean to you and where does it lead? Let's break it down - 10 tips on what to expect from the IRS, and how to handle the IRS scrutiny. 1. Yes, the IRS will make an unannounced first visit to your business. Be respectful and courteous. ... Read More
Why? How? When? Making designated payments to the IRS
When you make a payment to the IRS, it will be automatically applied to your account in a manner that is in the IRS's best interest. But what is best for the IRS in handling your payment can be different from what is best for you. In some situations, it is in your best interest to make a designated IRS payment, which tells the IRS how you would like them to handle and apply your payment. Designated payments should be considered in the following situations: 1. If you owe income taxes, it may be beneficial to designate your payment to pay a more recent tax liability off before ... Read More
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