I am ready to jump off a bridge Advice Needed

[car67]

Seriously I am at a crossroad that has me stumped and I need advice.

I am Chap13 converted to a Chapt 7 and discharged Dec 2009
I tried to add my wife to the case but could not as the IRS was waiting
as it turns out she worked at her father company who didnt pay $150,000 in 941 payroll tax....... So there was no way to add her to the 13 as the payments on that sum is over $2000 a month no way I could help her then as my personal business is suffering with the economy and all.......

Well fast forward March 2010 things are slowly getting better with my business and the wife took a job to help pay her car note and get our
family some health insurance.. We are finally making progress other then myself breaking my leg Jan 2010 and needing surgery but the debt is affordable after insurance kicked in thank god....

My problem is this, now my wife just got a letter in the mail that her temp job has been ordered by the IRS to levy her wages. Her temp job was via a personal temp agency which she is no loger employed by as she got hired by the place she went on as a temp... She is in charge of books and payroll...

I feel bad for her, as its not her bill her father created the problem and somehow he has been moved to non collectable status with the IRS so now the IRS is looking at my wife for this money as she did sign payroll checks at her fathers company. I understand the penaly recovery act and all but jesus the poor gal doesnt have that kind of money and if she did she would pay it. If they levy her wages she might as well quit working which hurts us even more.... We suspect she will lose her job once her employer sees this notice and we have tried to do everything we can to call the IRS and explain........

What would you guys do what would be the best approach with no credit or monies to pay and she will lose job if she gets a levy due to her position.....

thanks car 67

The father in story hasnt attempted to help and hasnt filed taxes and yet they dont harrass him I just dont get it!

[tigergem]

IRC Section 6672(a): Any person required to collect, truthfully account for, and pay over any tax imposed by this title who willfully fails to collect such tax, or truthfully account for or pay over such tax, or willfully attempts in any manner to evade or defeat any such tax or the payment thereof, shall, in addition to other penalties provided by law, be liable to a penalty equal to the total amount of the tax evaded, or not collected, or not accounted for and paid over.

This is commonly known as the 100% penalty. The penalty is assessed for the Trust Funds not paid. Trust funds are the money you withhold from an employee's paycheck, which includes federal income tax and the employees' share of FICA and Medicare. This money is held in trust until you pay it to the Internal Revenue Service.

* Are you the "responsible" person?
* Did you "willfully" fail to collect or pay over such tax?
* Did you have knowledge that the payroll taxes were unpaid?
* Did you have the power to control payments to creditors or the IRS?
* Did you prepare or sign the 941 returns?

Who is a responsible person? It may be the person who has the power to direct the collection of trust funds, the power and authority to pay trust funds and other creditors, or power and authority to determine who gets paid first or last.

According to the IRS, a responsible person is a person or group of people who have the duty to perform and the power to direct the collecting, accounting and paying of trust funds. This person may be:

* an officer or an employee of a corporation
* a member or employee of a partnership
* a corporate director or shareholder
* a member of a board of trustees of a nonprofit organization, or
* another person with the authority and control to direct the disbursement of funds.

The IRS may assess the penalty against anyone:

* who is responsible for collecting or paying withheld income and employment taxes, and
* who willfully fails to collect or pay them.

According to the IRS, for willfulness to exist, the responsible person must:

* Have known about the unpaid taxes, and
* Have used the funds to keep the business going or allowed available funds to be paid to other creditors.
* Other standards regarding willfulness include intentional, deliberate, voluntary, reckless disregard, knowing or accidental, free will or choice.

The issues presented in determining who the responsible person is and whether or not willfulness exists depends upon the facts and circumstances in each case. If the taxes are not paid, the IRS will be looking for someone to penalize.

So your wife needs to know if she was a "responsible person" as defined by the IRS, and also find out what her rights are. I hope this helps. Good luck.

[car67]

There is no doubt in the context of the law she was liable as she was a officer of the corp and her father let her write checks to pay bills at the direction of the father who decided who got paid and didnt as he was the owner. I understand the liability exists and she is liable in the scope of law but it just doesnt sit right while a parent who created a tax debt shuns it to his kids and doesnt help and I am forced to watch with no iron in the fire....... I want to file a lawsuit and force discovery on him to make him see the light but then it just tears a family apart at the same time....... Thats what I mean by wanting to jump off a bridge and then the results wont matter to me anymore but I am at a loss how to attack this situation in a role of wanting to help//////

[tigergem]

Yeah that really is a crummy deal, and I am really sad for your situation. So did she ever ask the IRS about holding the other officers of the corporation jointly liable for this debt -- and if not, why not? I mean it only makes sense that they would go after anybody and everybody. Sorry she got left holding the bag. Is dad really that stone cold or just oblivious or maybe thoroughly embarrassed -- or maybe not fully informed of the situation?

[justbroke]

Sounds like she needs a tax attorney, pronto!

[car67]

Yes got a tax agent ex IRS guy working on the case but even he admits this thing is a huge mess. JustBroke I have tried Ronnie Deutsch Nightmare did nothing at all just kept asking for more forms and more money but collections just intensified on IRS side.... So switched to the guy I am using know who comes highly reccommended by the bankrupcty attorney............ Yes Tiger Gem some how the other two officers got moved to non collectable which kicked off the Trust fund penalty to come after secondary parties..... I should force the father to answer in a courtroom as to why and whats fair for all... But dang I like and love everyone involved but when the IRS grim reaper is round the corner what do ya do!

JustBroke I read alot of your replies your a smart cookie and do appreciate your help throughout the forums..... Do you have any strategic thinking off the wall ideas? I was thinking 13 for her and paying disposable of $500 a month it wouldnt clear the debt in 60 but can you file a 13 that way even if you cant make the money needed to pay the full bill and just pay the partial over 60 months and then repeat the cycle again if the money cant be raised in the first 60 months?

[tigergem]

Huh. I guess I would want to know what the other two did to get themselves rendered non collectible and duplicate that.

[justbroke]

I just recently heard about Ronnie Deutsch or however she spells her name. I always like Tax Masters myself. Alas, they are just commercials and nothing goes further then actually working with them.

I personally don't know if the "penalty" portions of the IRS tax debt assessed to her as dischargeable, but if they are... a Chapter 13 may just be the thing. That would allow her to commit only enough to pay the "non-dischargeable" portion and then to discharge the rest after committing only her disposable income. I have never had to negotiate with the IRS except for a payment plan. Maybe they'll even put her on a payment plan (which I think the maximum they can take is $350/month through garnishment). I just wouldn't want to get to the point where the IRS is threatening a levy action.