In this presentation, I will cover the basics of Form 941 taxes. Form 941 taxes represent the amount of money that an employer must withhold from his or her employees’ wages for remittance to the IRS. This includes social security, Medicare, and income taxes. We'll then discuss the Trust Fund Recovery Penalty. To encourage prompt payment of withheld income and employment taxes, including social security taxes, railroad retirement taxes, or collected excise taxes, Congress passed a law that provides for the Trust Fund Recovery Penalty (TFRP). Sec. 6672(a) imposes a penalty on any person who is “responsible” for paying payroll taxes and “willfully” fails to do so.

We'll delve into the situations in which the TFRP arises, cover the procedures surrounding it, the defenses, how easy it is for the IRS to prove a case, what happens if your client loses, how the IRS applies TFRP payments, and "tattle tailing" on others.

25:T413,

In one of the climactic scenes from 1954’s On The Waterfront, Crime Commission prosecutors had to make their corruption case against union boss Johnny Friendly (a/k/a Michael Skelly) by convincing a reticent yet pure-hearted Terry Malloy to come forward and tell what he knew about corruption in the International Longshoremen’s Association, beginning with the murder of Joey Doyle, because an underling insisted that “we were robbed last night and can’t find no books.”

If that same case came up in 21st Century tax court, Eva Marie Saint and Karl Malden could’ve stayed at home rather than serving as Marlon Brando’s cheering section, because government prosecutors could reconstruct the ILA’s income, based on the records retention requirements in Section 6500 et seq.

In this course, we will discuss the elements of the federal tax evasion statute and delve into the methods that the IRS uses to reconstruct income in tax fraud cases.<