What happens when IRS audits your business and you have not filed taxes can they take everything?

Question

IRS Business Audit

Answer 1

They can put a lien on the assets of the business, and can also seek monies from persons deemed "responsible" by the IRS. If the taxes involve "payroll taxes" the IRS can go after personally the person at the business responsible for signing the checks of the business. If needbe, they can auction off the business and it's assets to try and get the taxes owed, but that's usually the last resort. Also, filing bankruptcy does not necessarily wipe out IRS debts.

Answer 2

Firt off what was your justification for not paying taxes (There are not many)? If you have no acceptable defense then the IRS will determine what they think you owe, add penalties and present you a bill. If you do not pay that bill with in the time aloted they will begin legal proceeding to seize your assets and possibly bring criminal charges. If you buisness is a proprietorship then yes they can seize all of your personal property. If the buisness is some form of corporation then they are limited to corporate assets unless they can prove you mixed your corporate assets with your personal assets. If they can prove this a judge could extend the seizure to include your personal assets. Now the IRS typically seize all assets due to the fact that they are never certain of how much money an auciton will generate. Then they auction all assets, deduct a service fee for the auction, then deduct what you owe in taxes and penalties, and finally if there is anything left it is returned to you. If at the conclusion of the auction you still owe money that follows you until you die, get a court order to remove the debt (never happens), or you settle with the IRS.
Really though you should be more concerned about avoiding prison rather than losing your buisness.

Answer 3

well... that depends on how much everything is worth. It also depends on if the business was limited liability and all of that. If you backed the company with all your assets than yeah they will take pretty much everything if you owe enough in taxes. They will not take everything if you can pay for the taxes (with interest) plus whatever fined you have. I'm also pretty sure there are some loop holes you can find, like filing for bankruptcy (under both chapter 7 and 11 - again depending on liability).

Basically you'd have to hire a (good) lawyer and have them work it out for you or actually read up on what is happening. I have no links thats just what I know.

Answer 4

If you owe enough in taxes, penalties, and interest and do not make acceptable payment arrangements with the IRS, they can certainly seize all of the assets of the business. Whether or not they can take your assets depends on the type of business (Sole proprietorship, LLC, etc) and many other factors. If you find yourself in this situation, find a good tax attorney.

Answer 5

They can determine an amount that you would have owed if you had filed properly plus penalties and interest. If the value of the business assets are more than that amount, they can't take more than you owe. On the other hand, once they take enough to cover what you owe, whatever is left may not be worth having.

Answer 6

i'm self-employed at I merely have been given audited a pair months in the past. It seems I made a typographical errors in recording one in all my inventory trades in Jan 2004. It took 2.5 yrs for them to seize the errors, yet their laptop finally caught up with me. They sent me a invoice for $32,000 declaring if i could no longer instruct I had made a valid errors, i could would desire to pay the completed quantity interior 30 days. I fixed up my errors, sent interior the corresponding unique documentation and recalculated each and every thing and it grew to become out they owed me $40 two. they merely sent the examine final week. the element is, they'd flow back as much as six years and audit your returns so except you desire to stay in paranoia for the subsequent seventy two months, i could recommend doing all your taxes as though Uncle Sam replaced into looking over your shoulder. And save your receipts because of the fact the load of evidence continues to be with the tax filer, no longer the government.

Answer 7

We can help stop this action if you need help. I have helped many people in this forum with this type of problem. There is no cost to evaluate your situation.

You will need to click my picture and send an email if you need help since I cannot leave contact info in the open here.

--A Damn Fine Tax Advisor

Answer 8

Pepsi guy gives best answer, others have some misstatements.