Jonathan Garcia said:So here’s the situation: someone I know is facing $20 back taxes because of unpaid payroll contributions (he was a board member at the time and wasn't employed anywhere else).
They’re coming after him for the period from January 1, 2014, all the way until the bankruptcy wrapped up.
The pre-bankruptcy settlement process actually kicked off back in 2013, but since they didn't meet the requirements, the IRS ordered them to move straight into formal bankruptcy—which, unfortunately, didn't officially close out until October 2015.
To make matters even worse, the tax authorities actually tried to dissolve the company in early 2014 since there were zero assets or employees left, but they backed off because the bankruptcy was already underway.
Is it seriously possible that an owner is being penalized just for trying to do things by the book? It feels like he's being stuck with the bill for the entire time the courts dragged their feet on the bankruptcy proceedings!
It’s pure, unadulterated madness. Someone always has to pay for all these bureaucrats, doesn't he? I can't believe they're starting up with this nonsense again. There was a time when they weren't chasing people down with this stupidity; they started playing these games around 2015, then stopped last year... and now we're back to this? Are you kidding me?
Did he have an employment contract with his own company, and if so, what was the salary amount?
When did the ruling come through, and from whom—the IRS or Medicare?
Are they charging him just for health insurance premiums, or for Social Security contributions too?
The whole thing stinks. For one, the law changed on January 1, 2017, when these absurdities were supposedly abolished, so there shouldn't even be a basis for collecting anything from 2017 onwards.
And also, if the company is in bankruptcy, has a trustee been appointed yet?
If a trustee has been assigned, then the former board member effectively ceased to be a board member, which should mean there's no legal basis to collect those contributions from the moment the bankruptcy opened until today.
As for the period before the bankruptcy was officially triggered? That's a total gray area. But honestly, what does he have to lose? He might as well file a grievance. And frankly, he should probably thank those 151 clowns in Congress back in 2014—most of whom, whether they were Democrats or Republicans, likely voted for this exact same mess. As one former representative used to say: "it's just different packaging for the same garbage."
Here is the list:
http://www.congress.gov/members. Most of them are still active today.
Someone correct me if I'm wrong, but even during that murky, dark period when the laws were conflicting, the only real dispute was over health insurance premiums. There was never any doubt regarding Social Security contributions; those were always supposed to match the amount stated in the employment contract, even if someone was working for their own firm.