Recently, the IRS and United States Department of Justice (“DOJ”) have been criminally prosecuting more payroll tax cases than ever before.  Several years ago the decision was made to focus on payroll tax cases for both civil and criminal enforcement, given the importance of payroll taxes to the federal income stream.When it comes to charging taxpayers criminally for the failure to account and pay over payroll taxes there are three main statutes the IRS and DOJ use: IRC § 7202 (the felony statute for payroll tax violations), IRC § 7215 (the misdemeanor statute for payroll violations) and IRC § 7201 (Tax Evasion).IRC § 7202 - Willful Failure to Collect or Pay Over TaxIRC § 7202 makes the failure of an employer to account and pay over the payroll taxes a felony.  IRC § 7202 was designed p... 04/21/2024

Businesses that fall behind with payroll taxes are the number one source of new clients for most tax rep professionals.  The major issue many of these clients has is confusion about what to do first.  Often we hear “I should make a payment against the oldest period first, that way the IRS knows we are serious.”No they don’t!The IRS does not think that way.  The first step to do anything with the IRS is to get into tax compliance first.What is “Tax Compliance”?In order for the business to have any chance of surviving the tax debt issue is being able to get back into tax compliance, meaning it is filing and paying the payroll taxes on time.  If the business is unable to do this, then it needs to shut down, or the IRS will force the issue by levying the bank accounts and effectively making... 04/21/2024

Businesses that fall behind with payroll taxes are the number one source of new clients for most tax rep professionals.  The first three issues that must be dealt with are: Can the business get into and maintain tax compliance? Is this business viable in its current form? If the business is not viable in its current form, can it be restructured to be a viable ongoing concern? Tax ComplianceIn order for the business to have any chance of surviving the tax debt issue is being able to get back into tax compliance, meaning it is filing and paying the payroll taxes on time.  If the business is unable to do this, then it needs to shut down, or the IRS will force the issue by levying the bank accounts and effectively making it impossible to operate.  The reason is that, if the business is not ... 04/21/2024

We frequently have taxpayers arrive in our office with collection notices for an IRS balance due that they believe they do not owe.  Whether due to not receiving the notice of proposed changes (CP-2000), or because they submitted records that were ignored by the IRS, these taxpayers are now facing balances with penalty and interest they should not have to pay.More often than not it is the Final Notice of Intent to Levy and Your Right to a Hearing (CP-90) that gets them to act and contact us.  Other times it is the Notice of Federal Tax Lien being filed that triggers the response. In either case, the first move is always to request the Collection Due Process hearing (“CDP”) and prepare for the hearing.  This will prevent any levy from being issued and allow us to work out a collection al... 04/21/2024