Why Businesses Need a Tax Attorney
Every business deals with taxes, but when something goes wrong, the fallout can feel immediate. A missed deposit, a delayed return, or a bookkeeping mistake may seem small in the moment, yet these issues can quickly draw the attention of the IRS or a state tax agency. Business tax rules are layered, fast-moving, and often confusing, and enforcement has been steadily increasing. Many owners discover problems only after the notices start arriving or an audit has already begun.
When that happens, you need more than basic accounting help. You need someone who knows how the IRS thinks, how state tax departments investigate businesses, and how to protect your company before penalties or enforcement escalate. The Law Offices of Stephen B. Kass, P.C. C. helps businesses navigate complex tax problems with practical strategies that safeguard operations, reduce exposure, and bring accounts back into compliance.
Key Takeaways
- Business tax problems can multiply when returns, deposits, or filings fall behind.
- IRS and state tax agencies have broad authority to issue liens, freeze accounts, and seize assets if issues are not resolved.
- Payroll tax mistakes carry some of the highest risks and can create personal liability for owners and officers.
- A business tax attorney can negotiate directly with tax authorities, stop or delay enforcement, and create a clear plan to resolve debt or compliance issues.
- The Law Offices of Stephen B. Kass, P.C. C. guides businesses through audits, payroll tax disputes, delinquent returns, and complex IRS and state tax investigations.
Common Business Tax Problems We Handle
Businesses can run into tax trouble for many reasons. Cash flow issues, staffing changes, accounting gaps, or rapid growth can all lead to filings or payments falling behind. Once the IRS or a state agency notices a problem, penalties build quickly, and enforcement often follows. Our firm helps businesses address a wide range of tax issues, including:
Unpaid Business Taxes
Corporate income taxes, payroll taxes, sales taxes, and other business liabilities can snowball when payments lapse. The IRS tracks these balances closely and will move toward enforced collection if they keep growing.
Payroll Tax Issues
Payroll taxes are among the most heavily enforced areas of business taxation. Failing to withhold or remit employee taxes can trigger steep penalties and the risk of personal liability.
Trust Fund Recovery Penalty
If trust fund taxes are not sent to the government, the IRS may hold individual owners, officers, or managers personally responsible. These cases involve detailed investigations and require careful legal guidance.
Unfiled or Late Returns
Missing or late business returns can lead to automatic penalties, estimated assessments, and increased audit risk. Many clients come to us with several years of unfiled returns, which we help bring back into compliance.
Misclassification of Employees
Treating workers as contractors when the IRS views them as employees can create exposure for back taxes, payroll penalties, and multi-year audits.
Sales and Use Tax Problems
State tax departments closely monitor sales and use tax reporting. Late filings, underpayments, and record-keeping issues often trigger audits and significant penalties.
IRS Enforcement Actions Against Businesses
When a business falls behind on taxes, the IRS has several tools it can use to collect what it believes is owed. These actions often feel sudden, but they usually build after earlier notices go unanswered or after the IRS detects patterns of noncompliance.
Liens and Levies
A tax lien attaches to business assets, credit, and property, and signals that the IRS has a legal claim on what the business owns. A levy goes a step further and allows the IRS to take money directly from bank accounts or seize equipment, vehicles, and other property. These actions can disrupt daily operations and damage vendor relationships if not addressed immediately.
Asset Seizure and Business Shutdown
In severe cases, the IRS can seize assets or shut down a business until taxes are paid or secured. This may involve padlocks on the door, removal of inventory, or suspension of business licenses. Early intervention is essential to prevent these outcomes and restore stability.
Audits
IRS audits can involve multiple tax years, complex record requests, and interviews with staff or owners. Once an audit begins, it is critical to manage the process carefully so the scope does not expand or lead to additional years of review.
Personal Liability for Business Taxes
In some cases, the IRS can hold individuals liable for business tax debts. The risk depends on the structure of the business, the alter ego doctrine, and the type of taxes, as well as other factors. To protect your personal assets from being seized for business tax debts, you need to work with an experienced business tax attorney.
Payroll Taxes and Trust Fund Liability
Payroll taxes are one of the most closely watched parts of business compliance, and even a short interruption in deposits can trigger fast action from the IRS. When a business withholds taxes from employee wages, those funds are considered trust fund taxes. The IRS treats them as money held on behalf of the government, which means any delay in sending them creates significant risk.
Unpaid trust fund taxes are unique because the IRS can pursue individuals inside the company, not just the business itself. Owners, officers, managers, and anyone involved in financial decisions may be questioned through a Form 4180 interview. These interviews help the IRS decide who was responsible for withholding and remitting payroll taxes. If the agency concludes that someone had authority over payments and allowed the taxes to go unpaid, that person may be assessed the Trust Fund Recovery Penalty. This penalty creates personal liability for the unpaid amount.
Because payroll tax disputes can quickly move from a business issue to an individual one, early legal guidance is essential. Addressing the problem before the IRS completes its investigation can protect both the company and the people involved.
Failure to Deposit Penalties and FTD Alerts
Payroll tax deposits are one of the first places the IRS looks for signs of trouble. When a deposit is missed, even by a short time, the IRS automatically adds Failure to Deposit penalties. These penalties start around 2 percent and climb to 15 percent as time passes, which means a small cash flow problem can turn into a surprisingly large balance before the business realizes what happened.
Many businesses receive an FTD Alert before things escalate. At first glance, this notice may seem minor, but it is actually a sign that the IRS has already flagged your account for potential noncompliance. Ignoring an alert increases the chances of follow-up calls, a revenue officer assignment, or a broader review of your payroll records. Addressing these issues early usually keeps the problem contained.
State Business Tax Problems
While many businesses focus on IRS issues, state tax authorities are often just as aggressive and sometimes even quicker to act. States monitor sales and use taxes, employment taxes, and business filings closely, and a small oversight can trigger penalties, license problems, or a full audit. For companies that operate in more than one state, the risks multiply because each state has its own rules, deadlines, and enforcement style.
Sales and use tax issues are among the most common state-level problems. Missing filings, underreported sales, or record-keeping gaps can lead to large assessments once penalties and interest are added. Employment tax disputes are also frequent, especially when states believe workers were misclassified or payroll taxes were not properly withheld. In some cases, a state audit can expand across several years or spark additional inquiries from the IRS.
State tax problems often grow at the same time federal issues are developing, and handling one without addressing the other can leave gaps that create more liability.
Options to Resolve Business Tax Debt
Business tax debt feels overwhelming, but there are several proven paths to relief. The right strategy depends on your financial situation, the type of taxes owed, and how far the IRS or the state has taken enforcement.
Installment Agreements
This option allows a business to repay its tax balance in structured monthly payments. Installment agreements can stop collection actions and give companies room to regain control of cash flow.
Offer in Compromise
In some cases, the IRS or a state agency may agree to settle a tax debt for less than the full amount owed. These settlements are not guaranteed, but they are possible when a business can show that paying the full balance would create financial hardship or is not realistically feasible.
Penalty Abatement
Penalties often make up a large portion of business tax debt. If the underlying issue was caused by circumstances outside the business’s control, such as natural disasters, health issues, or sudden financial setbacks, penalty abatement may significantly reduce the overall balance.
Currently Not Collectible Status
If a business is unable to pay anything at the moment, the IRS may temporarily pause collection efforts. This does not erase the debt, but it gives the business time to stabilize without the pressure of immediate enforcement.
Bankruptcy Options
In severe cases, business bankruptcy may offer a structured way to manage or discharge certain tax debts. Chapter 11 can help a company reorganize and continue operating, while Chapter 7 may be appropriate for businesses that are shutting down.
Why Choose the Law Offices of Stephen B. Kass, P. C?
When your business is dealing with tax trouble, you need an attorney who understands both the law and the day-to-day realities of running a company. The Law Offices of Stephen B. Kass, P. C. offers that balance. Our firm has spent decades helping businesses resolve IRS and state tax problems that feel overwhelming, urgent, or simply too complex to manage alone.
Stephen B. Kass is a business tax attorney who has guided companies through audits, payroll tax disputes, delinquent returns, and high-pressure collection cases. He understands how the IRS approaches business taxpayers and how state tax departments conduct their investigations. That insight allows us to anticipate issues, reduce exposure, and push for outcomes that protect the business’s long-term stability.
Clients also rely on us because we know how stressful these situations are for owners and executives. Tax problems can quickly reach beyond the company itself and threaten personal finances, especially in cases involving trust fund taxes. Our firm focuses on minimizing that risk and building strategies that protect both the business and the individuals behind it.
With offices in New York and Florida, and a practice centered under the New York bar, we offer accessible support while serving clients with nationwide tax concerns. More importantly, we offer steady guidance, straightforward communication, and practical solutions that help businesses regain control and move forward.
When you work with our office, you get a partner who understands that every tax problem carries real consequences and deserves a focused, personally tailored plan to solve it.
Protect Your Business with Experienced Tax Representation
Business tax problems rarely fix themselves. The longer notices, penalties, or payroll issues sit unresolved, the fewer options you have and the more aggressive the IRS or the state may become. If you are facing mounting tax debt, an audit, or the threat of enforcement, now is the time to get experienced guidance.
The Law Offices of Stephen B. Kass, P. C. can help you understand your risks, review your options, and create a clear plan to protect your business. Schedule a confidential consultation with a business tax attorney today and take the first step toward resolving your tax problems with confidence.
Frequently Asked Questions
What are the most common IRS business problems?
Unpaid payroll taxes, unfiled returns, penalties, audits, and enforced collection actions like liens or levies are the issues businesses face most often.
Can business owners be personally liable for payroll tax debts?
Yes. In payroll tax cases, the IRS can assess the Trust Fund Recovery Penalty against owners, officers, or anyone who controlled financial decisions.
What is the Trust Fund Recovery Penalty?
It is a penalty that makes certain individuals personally responsible for the portion of payroll taxes withheld from employees but not remitted to the government.
How do IRS Failure to Deposit penalties work?
If payroll deposits are missed or late, the IRS automatically adds penalties that increase over time. These penalties often grow quickly if not addressed.
Can a business tax attorney also handle state tax problems?
Yes. Our office helps with both IRS and state-level issues, including sales tax problems, employment tax disputes, and state audits.
What options exist if my business cannot pay its taxes?
Depending on your situation, options may include installment agreements, Offers in Compromise, penalty abatement, Currently Not Collectible status, or certain bankruptcy strategies.
Do I need an attorney if the IRS has only sent a few notices?
Yes. Early intervention often prevents the problem from escalating into liens, levies, or a full audit.
Will resolving tax debt give my business a fresh start?
In many cases, yes. Once a plan is in place, businesses can stabilize cash flow, protect assets, and move forward with clarity and confidence.
