Thursday, March 24, 2011

Crossing your T's and Dotting your I's

As we all know when dealing with the IRS it is important to make sure you cross your T's and dot your I's.

We recently had a client who came to us with a closed business. He wanted to simply pay the trust portion of the liability (Federal Income Tax, Social Security, and Medicare withheld from the employees checks) and close the business formally with the IRS.

We assisted him with the closure of the business and gave him the appropriate payoff for the trust fund. The business owed closed to $50,000 in 941 tax liabilities upon closure, the trust fund was $30,000. The client paid the $30,000 in trust fund with one check. We filed all the final returns, final financial statements, recorded the final bank statements, and informed the IRS of the closure. We also disclosed the asset situation (taken over by a factor at closing). Upon finalizing all the documentation informing the IRS of the dissolution, the IRS determined the business liability to be currently non-collectible.

So remember, obtaining all the required information prior to addressing the IRS liability is key in obtaining a successful resolution!