Owe IRS Trust Fund Payroll Tax, Beware = Trust Fund Tax, 6672 Penalty – Hire a IRS Tax Professional

by steve | Sep 10, 2009 | Tax Help, Uncategorized

If you Owe Back Payroll Taxes, IRS is coming after you. Former  IRS Can Help.

 
Any time you owe back trust fund tax is always wise to hire a former IRS agent or someone with extensive tax experience to go ahead and manage the trust fund that with the Internal Revenue Service.
The Internal Revenue Service takes unpaid trust fund taxes a lot more serious the most taxes simply because it is taxes withheld. IRS takes a much closer look on repair cases so beware if you have been pyramiding tax liability.
The reason I am drawing interest to this type of case is because these cases can be used by the criminal division to put you in jail.
Pay your 941 taxes.  If not hire a tax professional to help negotiate these tax matters.
The other reason I am drawing this to your attention is that there is a tendency when your company is failing, to start up a new corporation.  If the IRS gets wind of these companies moving from company to company and building up IRS payroll taxes, expect the IRS to amp up enforcement.
 
The IRS procedures on Unpaid Trust fund Taxes
1. When a taxpayer is identified as a repeater and pyramiding trust fund taxes, the IRS attempts initial contact within 30 days from receipt of the case.
See IRM 5.1.10 General Handbook, Taxpayer Contacts. Normally, the IRS arranges to meet the taxpayer and his/her representative at the place of business.
If such arrangements are not made, the reason why must be documented in the case history. Such a visit will be more productive and provide an opportunity to view and assess the business operation and it’s assets in the event a risk analysis determination needs to be completed.
The field visitation will also facilitate review of any books and payroll records. In the event the RO is not able to meet the TP at the business location on initial contact, IRM 5.1.10.3(1) requires that a field call be made to the business location to view the assets when practical, but prior to closure of the case.
Prepare to conduct a 4180 interview at the time of the initial contact. Consider calculating the potential TFRP based on the current assessment.
Use the ATFR system to make a rough calculation of the penalty and be prepared to discuss the process and the potential amount of the penalty during initial contact. See IRM 5.7.3 (TFRP) for additional information.
Get the taxpayer current with FTD’s from the date of first contact. Document the case history as to what type of depositor the business is (monthly, semi-weekly) and how the deposits are made (FTD coupons, EFTPS, etc.). The Revenue Officer will monitor compliance with FTD’s.
Also, verification that the FTD’s being made are accurate based on the amount of the current payroll will be monitored. See IRM 5.1.10, Taxpayer Contacts for more specific requirements regarding what information must be obtained during initial contact.
Pyramiding must be stopped immediately.
Advise the taxpayer that enforcement action will be taken if acceptable proof of compliance is not provided as required while the delinquent tax problem is being resolved. In the event the taxpayer continues to pyramid, all appropriate remedies will be used to bring the taxpayer into compliance and to immediately stop the pyramiding. If routine case actions have not been an effective way to stop the pyramiding, consider alternative solutions. Consider seizure and sale and/or pursuit of TFRP.
Secure sufficient financial information during the initial contact so that enforcement action can be taken, when appropriate.
If it is determined during contact with the taxpayer that the business is actually “Out of Business” or the business is no longer required to file returns, the RO will immediately complete Form 2363, Masterfile ENTITY Change, or Form 4844, Request for Terminal Action, to close out the filing requirements on IDRS. Continue procedures to pursue the TFRP investigation. See IRM 5.7.4.
Make a determination of the taxpayer’s ability to pay current and delinquent taxes without delay.
Set specific deadlines when requesting information from the taxpayer. The use of Form 9297, Summary of Taxpayer Contact, will be used in face-to-face meetings where deadlines are set. use of the Form 9297 will ensure the taxpayer has a clear understanding of what has been requested and the specific deadline date the information is required to be submitted. The requirement to make FTDs and the date required to provide verification of FTD can also be listed on the Form 9297.
Installment agreements are not appropriate for taxpayers who continue to accrue tax liabilities after contact because they are not in compliance. See lRM 5.14.7 and 5.7.4.8.1, BMF Installment Agreements, for the procedures to follow when considering an installment agreement for BMF taxpayers who begin making FTDs after contact and are no longer considered a repeater.
Oftentimes, cases involving repeater and pyramiding taxpayers will require enforcement action. On initial contact, when a deadline is set for a specific action, the L-1058, Notice of Intent to Levy and Notice of Your Right to a Hearing will be issued with all required enclosures. Receipt of L-1058, during initial contact, may prompt the repeater taxpayer to comply. (See IRM 5.11.1.2.2.2)
If contact is made, explain to the taxpayer the L-1058 is being issued to ensure their compliance with filing and paying requirements and failure to comply will result in enforcement action. The Revenue Officer must provide the taxpayer with their CDP rights and clearly explain the CDP process. The right to submit a Collection Due Process appeal will expire 30 days after issuance of the letter. The taxpayer will still have the opportunity for an “equivalent” hearing (See IRM 5.1.9.3.5) and/or to appeal a specific planned or actual collection action under the Collection Appeals Program (CAP) (See IRM 5.1.9.4).
If attempts to contact the taxpayer are unsuccessful, consider issuing L-1058 and immediate enforcement action as the next course of action.
 
Make a lien determination within required time frames. Defer notice of lien filing only if the taxpayer is actively seeking financing to resolve the liability or if there is doubt about the correctness of the current balance due.
If levy sources are exhausted and the repeater or pyramiding taxpayer has no assets which can be seized to resolve or offset the liability, consider issuing Letter 903 (DO), see IRM 5.7.2 Monthly Filing and Special Deposit Procedures.
These procedures should be used in the most egregious cases of non-compliance and where the collection procedures have already been unproductive.
Issuance of the Letter 903 (DO) will assist in promoting compliance.
Once the Letter 903 (DO) is issued, subsequent delinquencies by the taxpayer will be accelerated to the field for prompt enforcement action.
Inactivity gaps on these cases should be defined as ” more than 30 days” with no contact or case movement toward resolution.
During a taxpayer contact, when the taxpayer asks to be referred to the Taxpayer Advocate Service (TAS) or the taxpayer meets TAS criteria and the taxpayer’s issue cannot be resolved within 24 hours, then prepare and forward Form 911, Application for Taxpayer
This information is directly form the IRM.
The IRM is a true source of the “how to”  for the IRS.  It is their manual on how every case must be worked.