Legal Question in Tax Law in North Carolina

previous owner tax debt -IRS is coming to me

I worked for an owner of a day care center. She became ill, closed down and moved to another stste. I rented the building from the same person she did and opened my own day care business. The IRS has told me they are coming to me now, that I may be responsible for her tax debt since I worked for her. I was told to make deposits and pay bills while she was in the hospital for a short period of time. My name was on nothing. What should I do-can I keep her out of my business or do I have to let her come?. Thanks


Asked on 5/06/03, 8:38 am

1 Answer from Attorneys
Burton Haynes Burton J. Haynes, P.C.

Re: previous owner tax debt -IRS is coming to me

Whether you are liable for your predecessor's taxes depends on how the businesses were structured, and the extent of your involvement in her business. If you are merely operating the same business she did, then it (and thus you) may be liable. And if you had responsibility for the collection and payment of payroll taxes, and decisionmaking authority with regard to which creditors would be paid and which creditors would not be paid, you may be subject to the "trust fund recovery penalty." To determine the extent of your liability, we would have to understand the facts much better. But if you want to know more about the trust fund recovery penalty so that you can see whether or not you have something to worry about, please read my article on this subject as posted on my website (here's the link to the article: www.bjhaynes.com/articles13.htm). Good luck. Let us know if we can help.

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Answered on 5/06/03, 10:40 am


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