Trust Fund Recovery Penalties
Understand Trust Fund Recovery Penalties and Protect Yourself from Personal Liability
We determine who qualifies as a responsible person, document authority and actions, and build willfulness defenses or negotiate abatements to minimize personal exposure.
We reconstruct payroll records, reconcile Forms 941 and W-2s, and verify deposit histories to support your defense against TFRP assessments.
We analyze corporate structure, funding flows, and decision-making authority to pinpoint liability and identify mitigation paths under IRS guidelines.
IRSProb
Trust Fund Recovery Penalty
With extensive experience in TFRP cases, we guide you through the IRS investigation process, develop willfulness defenses, and represent you in penalty abatement requests or appeals.
We uphold rigorous standards in documenting authority and mitigating liability, ensuring every defense is fully substantiated.
We provide transparent updates and tailored defense strategies, keeping you informed and in control at every stage.
Leveraging deep knowledge of trust fund statutes and IRS procedures, we translate complex liability issues into effective defenses and negotiation strategies.
The TFRP applies when employers fail to forward withheld payroll taxes. The IRS conducts a Personal Liability Inquiry, issues a Form 2751, and assesses the penalty on identified responsible persons. Key defenses include lack of willfulness, absence of authority, or reliance on professional advice.
We assist with Form 2751 responses, prepare detailed affidavits, negotiate penalty abatements, and arrange installment agreements to resolve assessed liabilities.
After assessment, we help you satisfy the liability through payment plans, secure penalty abatements based on reasonable cause, or pursue appeals to limit or eliminate personal exposure.
Expert TFRP representation can reduce assessed penalties, prevent IRS liens on personal assets, and protect your home, bank accounts, and investments from seizure.
TFRP FAQ
Common Questions About Trust Fund Recovery Penalties
Important Terms To Know
- Trust Fund Recovery Penalty (TFRP): A 100% penalty imposed on responsible persons for willfully failing to collect, account for, or pay withheld payroll taxes.
- Responsible Person: An officer, director, or employee with the authority and duty to collect and remit payroll taxes.
- Trust Fund Taxes: Employee-withheld income tax and FICA (Social Security and Medicare) taxes.
- Willfulness: The voluntary, conscious failure to collect or remit trust fund taxes with knowledge of the obligation.
- Form 2751: The IRS form used to assess and notify individuals of TFRP liability.
- Personal Liability Inquiry (PLI): The IRS process to identify and interview potential responsible persons.
- Trust Fund Deposit: Timely remittance of withheld payroll taxes to the IRS.
- Penalty Abatement: A request to reduce or eliminate an assessed TFRP based on reasonable cause.
- Installment Agreement: A payment plan to satisfy assessed TFRP over time.
- IRS Appeals: The process for challenging a TFRP assessment through the IRS Office of Appeals or U.S. Tax Court.
The Trust Fund Recovery Penalty holds individuals personally liable for unpaid payroll taxes, equal to 100% of the unpaid trust fund taxes.
Any person with the authority and duty to collect and remit payroll taxes who willfully fails to do so may be assessed the TFRP.
Respond to Form 2751 within the specified timeframe by submitting written statements, financial records, and requests for conferences to contest liability.
The IRS reviews your role, authority, actions, and knowledge of unpaid taxes to establish willfulness under IRC §6672.
Yes, you can remit withheld taxes or negotiate an installment agreement to stop ongoing interest and penalties while disputing liability.
After assessment, you are personally liable for the full amount; you may seek abatement, arrange payment plans, or file an appeal to reduce or eliminate the penalty.
No, TFRP assessments are not publicly recorded, but unpaid liabilities may lead to IRS liens filed against personal assets.
The investigation and assessment process can take several months from the initial inquiry to issuance of Form 2751, depending on complexity.
You can appeal an adverse determination, present reasonable cause and lack of willfulness defenses, and seek review by the IRS Office of Appeals or U.S. Tax Court.
CLICK HERE or call (833) IRS-PROB or (214) 214-3000 to speak to a tax associate today. They will outline the specifics of your case and help map out your options moving forward. If you’ve received any certified mail or other threatening correspondence recently, make sure and tell them so they can take the necessary steps to intervene with immediate action. Don’t wait until it’s too late! Relief is just a simple phone call or click away.
IRSProb specializes in Trust Fund Recovery Penalty defense and mitigation, offering liability investigations, willfulness defense strategies, penalty abatement requests, and appeals representation to protect your personal assets.
About IRSProb
What Does IRSProb Do?
We become your official advocate before the IRS—handling all communications, filings, and negotiations so you don’t have to.
Our team of CPAs, enrolled agents, and tax attorneys reviews every detail and crafts a tailored roadmap to relief.
From powers of attorney to financial disclosures, we assemble and vet every form and schedule required by the IRS.
Drawing on decades of experience, we negotiate Offers in Compromise, Installment Agreements, penalty abatements, and more.
After securing a resolution, we guide you through payment setup, monitor compliance, and stand ready to address any follow-up IRS inquiries.
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Why Choose IRSProb?
You’ll work directly with one seasoned CPA—no handoffs, no bureaucracy—ensuring every detail of your case gets expert oversight.
When you call or email, you reach your CPA. Expect prompt, jargon-free updates at every stage of your case.
Hundreds of clients served, significant liabilities reduced, and glowing testimonials—your relief is our reputation.
Our Proven Process
1
File Form 2848 (Power of Attorney) and Form 8821 (Authorization) to freeze most collection actions (levies, garnishments), then request your entire IRS record
2
Compile past tax returns, bank statements, pay stubs, business records, and IRS notices into a single Discovery packet.
3
Assess all relief paths—Offers in Compromise, installment plans, CNC status, innocent spouse relief, and penalty abatement—to pinpoint the best solution.
4
Submit required forms and documentation, then advocate directly with your IRS revenue officer to secure optimal terms.
5
Set up payment or compliance plans, track deadlines, and manage follow-up filings to ensure IRS adherence.
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