Bookkeepers Beware
I worked as a bookkeeper for many years myself and never knew that I was placing myself in a situation where I could be liable for unpaid payroll taxes. If you are a bookkeeper and you have signature privileges on the checking account or you are authorized to make decisions as to what bills should be paid or not paid, you can be held liable. The IRS holds anyone either owner or employee who has it within their power to determine whether or not payroll taxes are paid liable. Even corporation status does not protect you from liability.
What I am referring to is what is termed the Trust Fund Recovery Penalty. This is the penalty the IRS imposes on individuals who should have paid these payroll taxes. The payroll taxes at issue here are those held in trust by the employer. These taxes are the Federal Withholding and Social Security/Medicare taxes-employee portion that are withheld from an employee;s pay check. These are held in trust and are required to be paid to the US Treasury in timely Federal Tax Deposits.
When a business pays other bills instead of paying their required payroll taxes, you are basically stealing from the US Treasury. Needless to say this is not tolerated and the IRS will pursue any and everyone who could be responsible for the lack of payment.
So, word to the wise, if you are a bookkeeper in this position, be sure your employer is paying these taxes. If you have doubts that they are being paid, or do not want to be held liable, be sure your name is not on the signature card at the bank and you can prove that you are not the final decision as to what bills are paid.
If you find yourself in this situation and need representation before the IRS, contact an Enrolled Agent. An Enrolled Agent can contact the IRS on your behalf and advise you on your options. Effectur is a company that employs Enrolled Agents and former IRS employees to help those who find themselves in trouble with the IRS.