We are providing FREE consultations via PHONE or VIDEO conferencing for your safety during Covid 19 emergency. Please feel free to call us if you have any with questions! 877-788-2937

IRS TFRP Help – Everything You Need to Know About Trust Fund Taxes and Penalties

As hard to believe as it may be, we are now in yet another year and here’s to hoping that 2022 will be significantly better than the last previous years, but we digress. What we’re here to talk about today is IRS TFRP help, or trust fund recovery penalty help, as it is better known.

With tax season coming up fast, our thoughts will soon be turning to our books and accounts, as we look to get all of our taxes in order so as to appease the wrath of the tax man.

If you’re a small business owner, you will likely already be aware that employment 941 payroll trust fund taxes can cause monumental headaches. When money is held ‘in trust’ it has to be paid to the Treasury on a weekly, semi-weekly or monthly schedule. This is all well and good, but should a business use these funds for any other purposes, I.E for paying rent or utilities, problems with the IRS could potentially arise.

It doesn’t matter whether this money was “borrowed” in good faith at all, if the money isn’t returned, the IRS can actually slap you with the trust fund recovery penalties portion and hit you with employment 941 payroll business back taxes personally.

Get tax help today by calling us at 1-877-78-TAXES [1-877-788-2937].

Our tax representation firm is in Whittier, Los Angeles, CA but serves taxpayers in all 50 states.

To ensure this doesn’t happen, here’s a detailed look at IRS TFRP help, or if you received Letter 1153 from an IRS RO revenue officer that you could appeal and protect your rights and options.

What exactly are TFRP – trust fund taxes?

Before we take a look at TFRP help and at why our professional tax service, professional, EA, CPA, attorney, could be so beneficial, we’ll begin by looking at what trust fund taxes are.

When an employer pays their employees, they won’t cut them a paycheck for all of the money that the employee has earned. Now, before you get too alarmed, don’t worry, because there is a reason for that.

The employer is legally responsible for withholding the employee’s portion of their Social Security and Medicare taxes (FICA) and their income taxes from the wages that they are paying their employees.

The employees trust that their employer will send these withheld payments to the IRS, US Treasury, on behalf of each of them – hence the name ‘Trust’ fund taxes.

What are the ramifications if an employer fails to pay trust fund taxes?

As far as IRS TFRP help is concerned, if the IRS fails to receive a 941 federal tax deposit, or if they receive a deposit that is much smaller than the usual deposit made by an employer, the business owner will be contacted by an IRS representative RO revenue officer by Letter 1153  that you could appeal and protect your rights and options.

Thanks to the 2015 launch of the Early Interaction Initiative, the IRS will identify employers whom are slipping behind with their tax payments, or who are notorious for missing tax payments or paying late. Here, an IRS representative RO revenue officer will contact the employer, either in person, or via a letter, and actually offer help and guidance, rather than slapping them with a penalty.

If however, the business owner is uncooperative, or if they are simply unable to pay the IRS the 941 payroll tax that they believe they are owed, an investigation will then be launched and this is where hiring a tax representation professional, EA, CPA, attorney will be recommended.

This investigation is known as a 4180 TFRP – Trust Fund Recovery Penalty investigation, and the long and short of it is that it legally permits the IRS to collect any owed unpaid trust fund taxes by any means necessary. This means that funds can come from the business accounts, as well as from assets belonging to the persons responsible for not making the necessary payments to the taxman.

Get tax help today by calling us at 1-877-78-TAXES [1-877-788-2937].

Our tax representation firm is in Whittier, Los Angeles, CA but serves taxpayers in all 50 states.

So, what exactly is the trust fund recovery penalty?

By now, you’re probably aware that, come hell or highwater, the taxman will always get his money, and by not paying, you are simply prolonging the inevitable.

The trust fund recovery penalty imposed by the IRS is basically a penalty which is equal to the balance of any unpaid employment 941 payroll taxes from your business.

The IRS bases this on the amount of any unpaid taxes that may be outstanding and that have been withheld, along with each employee’s portion of any withheld FICA taxes. Now, you may be thinking that that sounds fair as the IRS was legally entitled to these payments, but the penalties don’t stop there. The IRS also slaps you with interest on the TFRP, meaning that the employer responsible for not paying the IRS will pay considerably more in interest payments.

What can you do if you need IRS TFRP help?

If you get on the wrong side of the IRS, it’s important to act fast so as to minimize the financial damage you suffer. The longer the investigation goes on, the more charges you will incur and the more interest you will pay on top of the outstanding balance. Contact us as soon as you receive letter 1153 from an IRS RO revenue officer that you could appeal and protect your rights and options.

The IRS is relentless, and this won’t go away by itself, and they certainly won’t let you off with a warning and without paying. The good news is that, despite being relentless, the IRS are not heartless and they are more than willing to work with you and figure something out. You can appeal if you think the ruling is incorrect, you can come up with an ‘Offer in Compromise’, you can come to an installment agreement, and more besides.

Needless to say, any of the above is going to be tricky to a non-tax professional which is why hiring a professional tax expert, EA, CPA, attorney specializing in IRS TFRP help and other similar specialties is so beneficial and is so highly recommended if you do fall behind or get in trouble one way or another.

Of course, prevention is better than cure so the best way to ensure that you don’t need IRS TFRP – trust fund recovery help is to pay your taxes and to do everything legally and above board.

If you ever do find yourself in trouble however, the expertise of our tax professional firm Mike Habib, EA could prove to be a godsend and worth every cent that you pay them.

Get tax help today by calling us at 1-877-78-TAXES [1-877-788-2937].

Our tax representation firm is in Whittier, Los Angeles, CA but serves taxpayers in all 50 states.

 

badge
badge
badge
badge
badge
badge
Contact Information