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Can I reopen a company I had to shut down because of tax liabilities?
Anonymous5 views3 answers
In 2001 I had to shut down my company due to an unpaid tax liability. All the money owed was placed in a trust and the burden of liability shifted from my company to me personally. I have been on a payment plan and I'm very close to being paid off. If I reopen the same company, will the liability for what is still left owing, shift back to the company and come off of me personally?
The answers depend on what type of tax liability are due. It sounds like your company owed trust fund taxes (employment tax, medicare tax, and social security tax) so the IRS may pursue the person responsible for the business. Under the Internal Revenue Code, the person responsible for the business is ultimately liable for trust fund taxes. As the person responsible for the taxes, you cannot shift the liability to the company by opening the prior or new company.
If you shut an entity that owed employment taxes, they would immediately look for the responsible party and make them personally liable. In most states, the business owner is also personally liable for sales taxes. If your tax liability consist of either of these types of taxes, it might not be so easy to walk away.
Christopher Larson
Insight Law
Tax Attorney
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Separate from the tax liability issue: What did you do to shut down the company? Did you go through the dissolution process with the state? If so, contact the state dept and inquire what is required to revive the company.
