Penalties for failure to pay the tax Cincinnati OH

There is a host of civil penalties for negligent or inadvertent failure when failing to make proper or timely payments.

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City of Wyoming
(513) 821-7600
800 Oak Avenue
Wyoming, OH

Village of Arlington Heights
(513) 821-2076
601 Elliot Avenue
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Taft Stettinius & Hollister LLP-Attorneys
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Wood & Lamping LLP
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Lindhorst & Dreidame Co. L.P.A.
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Porter Wright Morris & Arthur LLP
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Baker Hostetler
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There is a host of civil penalties for negligent or inadvertent failure to make proper or timely payments and deposits of employment taxes. For any willful failure to withhold or pay employment taxes, both civil penalties and criminal sanctions may apply.

Perhaps the most commonly encountered civil penalty is the Trust Fund Recovery Penalty. This penalty is really a collection device, in that it is equal to 100% of trust fund taxes that have not been remitted to the Internal Revenue Service. Under this penalty, a "responsible person" can be held fully responsible for any willful failure to collect and pay trust fund taxes.

Who is a "responsible person" liable for the tax?

Will I be given notice of the IRS's intent to assess the penalty?

If I failed to pay the tax, what are my options?

Who is a "responsible person" liable for the tax?
Briefly, a "responsible person" is any person who has the duty to account for, collect, and remit trust fund taxes. Generally, "responsible persons" are the officers or employees of the company obligated to remit withheld taxes. The corporate veil of liability protection will not protect any responsible person - the IRS has the statutory power to pierce the corporate veil and assess personal liability.

The IRS has the burden of establishing who is a responsible person. Once this is done, the burden shifts to that person to establish that the failure to collect or remit employment taxes was not "willful". "Willful" does not mean that the responsible person acted with actual intent to defraud the government, but only that that person knowingly failed to comply with statutory requirements. Thus, if you are found to be a responsible person and you knowingly used trust fund taxes to pay other creditors, you most likely will have acted willfully.

Will I be given notice of the IRS's intent to assess the penalty?

To impose the Trust Fund Recovery Penalty, the IRS must provide a 60-day notice to the person against whom it plans to assert the penalty. The person receiving the notice can file an administrative protest against application of the penalty during this period.

If I failed to pay the tax, what are my options?

If you have failed to collect or to pay trust fund or other employment taxes you do have a few options:
1. Pay in full. Assuming there is no criminal prosecution, you can, of course, pay all outstanding taxes, penalties and interest in full. The IRS generally just wants the money. It also might be possible to abate the penalties for "reasonable cause."

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