Trust Fund taxes include social security, Medicare, and income taxes that are withheld from employee wages as mandated by the federal tax code. This type of tax is paid by employees, but the employer is responsible for forwarding the employee-paid taxes to the government.
When this doesn’t happen, the IRS is quick to step in and take action against corporate officers, finance officers, business bank account signers/co-signers, financial partners, and limited liability company members. The IRS charges a Trust Fund Recovery Penalty (TFRP) to individuals assigned with the collection and remittance of these taxes but who don’t comply with the rules.
The process of stopping a trust fund recovery assessment is quite complicated. First, the target person or persons must file a written appeal. If this is not done, the IRS will personally assess the person or persons responsible for the liability. Usually at this point, the right is lost to challenge the trust fund recovery penalty. (Under certain circumstances, the right is not entirely forfeited. For example, if the target was not responsible for paying trust fund taxes or simply did not do it wilfully, there’s still a chance to appeal.)
As with other tax problems, appealing against a trust fund recovery penalty is an arduous process that requires expert care and insight. It is wise to confront the IRS with expert help. While it is possible to represent yourself, it is not advised because the stakes are high – and best left to the professionals. Certified tax experts are aware of every clause in the tax code and every situation in which you may be granted tax relief.
If you’re a victim of misdirected Trust Fund Recovery measures, contact Long Island Tax Resolution Services today. Trust Fund Recovery measures are extremely serious and may disrupt your ongoing business affairs. Our highly qualified tax experts will give you the representation you deserve, handling your unique case with the highest degree of care.
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