Can certain Taxes owed to the IRS be discharged?

[Dollar Bill]

I will have state taxes due for my c -corp, and possible taxes due to IRS for the c-corp. I do not know what the amounts are yet because I have not filed the taxes. Should I or can I discharge them in my personal C7?

[HHM]

For such a short post, you have a VERY complicated question. Obviously, a personal BK will not absolve the taxes vis-a-vis the corporation. So, I imagine your question is whether and to what extent you may be personally liable for the tax debt as an owner and/or officer of the corp.

First off, what kind of IRS taxes are we talking about 1120, 940, or 941. Have you filed all returns, have you made and are you current with your Federal Tax Deposits (if any). Are there any liens outstanding, has the IRS levied any asset?

[Dollar Bill]

Thanks HHM.

I'm speaking of 1120 and 941 taxes. I have filed the 941, and have not received a bill that would include penalties as I am behind. I have a few years of 1120 that I may or may not owe. If I find out I owe....I'd like to know if I am personally liable for the 1120 taxes...oh yeah and the 941 too?

[Ugh07]

they will come after you for the payroll taxes at the very least, those I know pass to the owner of the corp and are not dischargable

[HHM]

You cannot discharge 941 taxes in BK, period. The IRS has 3 years to assess the Trust Fund Recovery Penalty (i.e. hold the responsible person liable, usually the owners) for the withholding portion of the 941. However, you can only be held personally liable for the principle withholding amount (i.e. Employee Withholding, SS, Medicare, Medicaid). You cannot be held personally liable for the Employer Matching portion of the 941 amount nor for the penalties and interest.

However, as for the 1120, usually owners etc are NOT liable assuming you have a true corporate structure to shield you. The 1120 liability dies with the corporation.

[Dollar Bill]

This may hav been answered but I will ask again..

I haven't iled the corp taxes....1120. Should I do so to know what I should include in my filing?

Do I need an amount?

[HHM]

To wrap things up, you should file the Missing Returns. For the 2007 return, be sure to check the box "Final Return" and write across the top, "business closed", or "out of business". That will allow you to bring closure to the company. Otherwise, the IRS will keep sending notices and whatnot.