What can I do about negligence regarding the payment of my company’s taxes?

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What can I do about negligence regarding the payment of my company’s taxes?

I am a partner in a business. My partner hired his bookkeeper and accountant to do the accounting and payroll needs for our company. After 2 years, I find out that the bookkeeper has never remitted or paid any federal taxes for our payroll. When I asked the accountant how he never caught this error, he does our yearly filings for the company, he said he didn’t know how this happened. Is it worth trying to sue both bookkeeper and accountant for negligence? What about my partner who brought these 2 idiots in? The company is going to have to close due to all of this.

Asked on May 9, 2012 under Business Law, Pennsylvania

Answers:

Ronald Cappuccio / Ronald J. Cappuccio, J.D., LL.M.(Tax)

Answered 9 years ago | Contributor

Your problems are a lot bigger than suing your partner.1st the IRS and any state taxing agencies will be able to go after you individually for the balance of the withholding taxes due. For the IRS, this is the portion that is withheld for Social Security, Medicare and the employee side of withholding. This is technically known as the civil penalty and is applied against each "responsible person." You need a tax lawyer immediately to handle this problem. Do not waste any time!

 

I hope this helps!

Ronald J Cappuccio

www.TaxEsq.com


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