Mixon Tax Law (713-814-4737) has published a guide explaining how unpaid payroll taxes can expose Houston business owners to personal IRS liability under the Trust Fund Recovery Penalty, and what the Letter 1153 appeal window means for those who receive it.
-- Houston-based Mixon Tax Law has published a guide to the Trust Fund Recovery Penalty, a federal provision that can hold owners and managers personally liable for payroll taxes their business failed to remit. Written by founder Phillip Mixon, a tax attorney and Certified Public Accountant, the guide outlines how that liability arises and what steps are available to those facing it.
More details can be found at https://mixontaxlaw.com/trust-fund-recovery-penalty/
According to a 2024 report from the Treasury Inspector General for Tax Administration, employment taxes and income tax withholding accounted for $3.18 trillion of the $4.9 trillion in total federal tax receipts collected in fiscal year 2022. A separate TIGTA review found that, as of December 2015, 1.4 million employers owed $45.6 billion in unpaid employment taxes, interest, and penalties.
Balances like these are the reason the penalty exists. As the guide explains, income tax, Social Security, and Medicare withheld from employee paychecks never belong to the business. Those amounts are held in trust for the federal government, so when they go unpaid, the IRS can bypass the LLC or corporate structure and pursue collection directly from responsible individuals.
The guide notes that this exposure can reach further than many owners expect. A responsible person is anyone with authority over which bills get paid, including a controller or a bookkeeper with check-signing authority. Intent to defraud is not required; using available funds to pay rent or suppliers instead of remitting withheld taxes is typically treated as willful conduct by the IRS.
The guide’s later sections cover what happens once the IRS moves forward. Liability is joint and several: if three officers share responsibility for a $90,000 balance, each can be assessed the full $90,000, not a proportional share. The process formally begins with Letter 1153, which opens a 60-day window to appeal before the assessment becomes final and collection against personal assets can begin.
“Most owners I see in these cases never meant to avoid their taxes,” Phillip Mixon said. “They were trying to keep the business running and paid everyone except the IRS. Many don’t realize the penalty survives a business closure and can’t be wiped out in bankruptcy, which is why that 60-day window matters.”
Interested parties can find more information by visiting https://mixontaxlaw.com/trust-fund-recovery-penalty/
Contact Info:
Name: Phillip Mixon
Email: Send Email
Organization: Mixon Tax Law
Address: 2000 S Dairy Ashford Rd Suite 298, Houston, Texas 77077, United States
Website: https://mixontaxlaw.com/
Source: NewsNetwork
Release ID: 89207054
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