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Tax resolution attorney Lance Drury, founder of the Law Firm of Lance R. Drury, and best selling author of “Successonomics” tells employers that as trustees of the U.S. government they are obligated to send in payroll taxes or suffer the consequences.
St Genevieve, MO, November 10, 2014: Tax resolution attorney Lance Drury, founder of the Law Firm of Lance R. Drury, and best selling author of “Successonomics” posted a new blog on the LANCE DRURY LAW website entitled “Using Withheld Payroll Taxes For Other Expenses is Dangerous Business.” Once you become an employer you also become a trustee of the U.S. government, a role that carries serious financial responsibilities. According to Drury, some businesses fall prey to thinking they can avoid this responsibility.
Drury says, “Unfortunately many employers fall into this very dangerous trap during financially stressful times. Be forewarned though that any other means of meeting financial obligations is preferable to using payroll taxes.” He continues stating, “The withheld taxes are called “trust fund taxes” and belong to the government.”
Once the IRS sees a business has failed to pay the withheld taxes, Drury says, “The IRS will assess what is called a trust fund civil penalty also known as a trust fund recovery penalty (TFRP). This civil penalty is imposed on any and all persons in the business having the responsibility for collecting, accounting for or paying over the taxes but “willfully” fails to do so.” The employer is not the only person the IRS goes after for this violation. They can and will go after anyone they consider, says Drury, “a responsible person”.
Drury warns employers to, “Be aware that the IRS can assess this civil penalty against every responsible person without first trying to collect the penalty from the employer.” The burden of proof falls on the individual who has had the TFRP imposed on them. Unlike in criminal cases where you are considered innocent until proven guilty, when it comes to the TFRP, you are considered guilty until proven innocent. Drury states, “it is the taxpayers’ responsibility to prove that they are either not a responsible person or that there was no payment to creditors when the payroll taxes were delinquent. Any responsible person in the business can avoid being assessed the TFRP by making all efforts to make sure that the withheld taxes are paid. If you are determined to be a responsible person the IRS can impose that you repay as much as 50% to 60% of the total payroll tax.”
He advises, “The Trust Fund Civil Penalty is serious and could mean the ruin of your business and personal assets. Seek the services of an experienced tax resolution specialist immediately.
About Lance Drury
Tax Attorney Lance Drury, founder of the Law Firm of Lance R. Drury, has been practicing law since 1984 and began representing individuals and businesses in disputes with the Internal Revenue Service in 2006. With offices located in Ste. Genevieve and Columbia, Missouri, Drury has positioned himself as a leading attorney in the state for IRS tax resolution issues. He is able to evaluate the unique situation of clients and provide them with honest answers and a specific plan to best resolve their tax problems
About The Lance Drury Law Firm
Since 2006, the Law Firm of Lance R. Drury has been representing individuals and businesses in disputes with the Internal Revenue Service and State of Missouri Tax Commission. With offices located in Ste. Genevieve and Columbia, Missouri, we’re proud to be your local choice for Missouri tax services.