Trust Fund Recovery Penalty — Personal Liability for Payroll Tax
Unpaid payroll tax can become a personal liability under §6672 — piercing the LLC veil with no judge required.
When a business doesn't remit withheld payroll taxes, IRS can assess the Trust Fund Recovery Penalty (TFRP) against 'responsible persons' who willfully failed to pay. The penalty equals 100% of the unpaid trust-fund portion and survives bankruptcy.
Frequently Asked Questions
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