Tax Consequences for Determining if a Business is For-Profit or Hobby

It’s important to understand the hobby loss rules when starting a side business.  For the first couple of years, it is common for a start up business to lose money.   If the side business loses money for several years, the business may be a hobby.  The tax consequences of reporting a business as “for profit” versus a hobby can be significant.
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Trust Fund Penalty – Rules for DBA and Single Member LLC

Generally, the IRS has to assess trust fund penalties to make individuals in a corporation personally liable for unpaid payroll taxes.  The word “corporation” has meaning in tax law.  If the business is not considered a corporation, then the owner is automatically personally liable for unpaid payroll taxes.  Read this blog for more information on the trust fund recovery rules for DBAs and Single Member LLCs.  Continue reading…


Trust Fund Penalty – Who is the responsible person?

The IRS will hold individuals in a company personally liable for trust fund recovery penalties.  The IRS will conduct an investigation to make this determination.  This blog discusses the factors the IRS evaluates during the investigation to determine the individuals considered a “responsible person” for trust fund penalties.
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IRS New "Fresh Start" Program works!

Earlier this year the IRS announced the “Fresh Start” program.  The IRS implemented this program to provide relief to struggling taxpayers.  I discussed the need for program in my blog posting, “IRS Overwhelmed by Offer in Compromise Requests, Changes Made.”  I must admit that I was a little skeptical of this program in the beginning.   But now I am a believer.
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