If you are or were an officer of a business, partner in a partnership, corporate director, a member of a corporation's board, shareholder, bookkeeper, or employee of a business that has either failed to make their monthly, quarterly, and/or yearly employment tax payments, or has been accused of mischaracterizing their workers as independent contractors rather than employees, you may have exposed yourself to potential taxes known as the "responsible party", or "trust fund" liability taxes. These are taxes which may not even be discharged in bankruptcy.
If the business organization you are, or were involved with has employees, then income, Social Security, and Medicare taxes must be withheld on the compensation paid to the employees. These taxes must be held in "trust" by the business organization for the Internal Revenue Service, and in certain circumstances, for the State. If these taxes are not paid to the governing authorities, they can proceed against anyone who they believe is a "responsible party."
The Internal Revenue Code gives very broad authorization to the IRS to classify anyone who is under a duty to collect, account for, and/or pay over taxes held in trust for the government as a "responsible party".
If this happens, the IRS and/or state taxing agencies can seize business and personal assets to satisfy back trust tax liabilities and may close down the business that is not in compliance with their business trust tax liabilities.
If this could describe you, DO NOT meet with the IRS or State on your own! How you answer their questions can determine whether you are a "responsible party".
It is critical that you have a professional representative who knows how the IRS and/or State work, who could attempt to formulate a strategy to prevent the assessment of the "responsible party" liability.
