Personal exposure addressed first
The corporate shell does not automatically absorb a trust fund assessment. That is the risk we work on first.
IRS Problems
The one tax debt the IRS pursues personally
Unpaid payroll tax is treated differently from every other balance — it can be assessed against you personally, not just the company.
Money withheld from an employee’s pay is not the company’s money. It is held in trust for the government, and when it is not deposited the IRS can assess a Trust Fund Recovery Penalty against any individual who was responsible for paying it — an owner, a bookkeeper, sometimes an office manager.
In California there is a second front: the EDD, which audits how workers are classified. Under the ABC test most subcontracted labour looks like employment, and a reclassification finding brings back employment taxes, penalties and interest across the whole audit period.
Scope
What’s included
Deposit history reconstruction
Every Form 941 filing, deposit and penalty mapped so you can see exactly where the gap is.
Trust fund penalty defence
Responsibility and wilfulness are both required. We respond to the Letter 1153 proposal and contest the assessment where the facts support it.
Late deposit penalty abatement
Failure-to-deposit penalties escalate sharply by days late. Many qualify for removal.
EDD audit representation
Full representation through the examination, including managing the sample methodology.
Worker classification review
Every contractor tested against the California ABC test and the statutory exemptions.
Going-forward correction
How you treat workers today affects how the audit resolves. We fix the process, not just the past.
Outcome
Why it matters
The sample is where audits are won
Auditors extrapolate from a sample period. Managing that methodology matters more than arguing any single worker.
One office for payroll and defence
If we run your payroll, the records an auditor asks for already exist in the form they want.
Process
How it works
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Assess exposure
Transcripts pulled, balances mapped, and personal liability risk identified immediately.
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Stop the bleeding
Current deposits brought up to date first — the IRS will not negotiate while new liabilities accrue.
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Defend and negotiate
Contest what is contestable, abate what qualifies, and arrange terms on what remains.
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Rebuild the process
Classification corrected, deposit schedule set, and filings calendared so it does not recur.
Suited to
Who this is for
- Employers behind on Form 941 deposits
- Anyone assessed a Trust Fund Recovery Penalty
- Businesses under EDD examination
- Contractors and trades paying crews on 1099s
- Companies that lost a bookkeeper mid-year
FAQ
Questions
Not if California law says they are employees. Under the ABC test the worker’s preference is irrelevant, and the liability for getting it wrong falls entirely on the business — back employment taxes, penalties and interest. We will review each role and tell you where you stand before an auditor does.
For the trust fund portion — the income tax and employee FICA withheld from paychecks — yes. The Trust Fund Recovery Penalty can be assessed against any individual who was both responsible for paying it and wilful in not doing so. Both elements are contestable, and that is usually where we start.
That interview is how the IRS decides who was responsible for the unpaid trust fund taxes, and the answers are written down and used later. It is an interview worth preparing for with representation present rather than answering on the spot.
Often needed alongside this
Other services
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California EDD & CDTFA Audits
An EDD or CDTFA audit reaches back years, applies a method rather than counting, and lands on businesses that never had a federal problem at all.
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Payroll Services
Running the numbers is the easy part. Staying on the right side of the EDD, wage orders, sick-leave accrual and worker classification is where employers actually get hurt.
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IRS Representation & Audit Defense
Sign a Form 2848 and every letter, every phone call and every deadline becomes ours to manage.
Let’s find out what you should actually be paying.
Thirty minutes with an Enrolled Agent, at no charge. Bring last year’s return and we will tell you plainly what we would do differently — and what it would cost.