The IRS may come after corporate officers for collection of unpaid "trust fund" taxes (payroll taxes collected from wages paid to employees), but what about other tax liabilities or penalties assessed against a corporation? Can the IRS collect from corporate officers, and if so, under what circumstances?
Are there any applicable code sections and/or court cases that deal with this issue?
asked 08 Jul '11, 17:55
Other taxes can be assessed on a "responsible person" if the corporation closes, or in the case of fraud. Responsible person liability arises when a corporation dissolves, terminates, or abandons its business.
In this case, the debtor initiated bankruptcy on July 3, 2001, but was not liable for the corporation's unpaid sales taxes until it ceased operations on March 31, 2003. The statute of limitations was still open, so the taxes could still be assessed and were not discharged. Ilko v. CA Board Of Equalization., U.S. Ct. App. (9th Cir.), Dkt. No. 09-60049 (6/27/2011)
answered 11 Jul '11, 17:13
Sales tax, Employment Tax, Unemployment Tax all can be asserted by a State entity to an individual officer of the corporation. Trust taxes are asserted under IRC 6672.
I don't have any great references. Each State is a little different as well as far as how they handle the assessment of different taxes to officers of corps.
Corporate Income tax as far as I can tell and have dealt with is not assessable to any individual.
answered 12 Jul '11, 14:54
Mike Wallen EA