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If the IRS asks you to fill out a 4180 form, that is an interview of a person that they feel may be a responsible person for the trust fund taxes of a corporation currently in business, or one that is about to go out of business.
The IRS sets this penalty up under IRC 6672.
As a former IRS Collections/Revenue Officer, I have filled out thousands of these 4180 forms over the past 38 years. There are many tricks and traps that the average person or even some professionals do not know even exist. I would never recommend to a client to go into the IRS and fill this 4180 form out by themselves. They are walking into a hornets nest.
Let me give you an example of what I am referring to.
When given the form 4180 to complete, many people fill out the whole form and guess at some of the answers. By guessing, you are showing that you had more knowledge than you actually did. Far better to answer unknown. If you are not absolutely sure of an answer, always answer unknown. It clearly shows you knew less about the business than filling out answers to questions you were unsure of. The less knowledge you had of the events, the better off you are.
Also, at the end of the form 4180 you can give a statement. Always give a defense statement. This is your best chance to explain your way out of the trust fund penalty. I would also recommend you go as far as getting documentation to corroborate your position and getting affidavits from other persons supporting your best position. Make sure the Revenue Officer does attach your statements and documentation to the file. Remember, their supervisors review the cases and it helps for them to see the objections. Get a copy of everything put into the file.
Remember, the IRS is interested in one thing, making sure as many people as possible are responsible for this trust fund penalty to better their chances of collection.
Do not be a fool, seek professional advice.
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