In a nutshell, Employers are required to withhold Federal Income taxes and Federal Income Contributions Act (FICA) taxes from their employee's pay; match the FICA withholding and remit the aggregate amount to the Service quarterly. See: IRC § 6157.
FICA taxes, a/k/a “employment taxes,” are credited towards future Social Security and Medicare benefits.
The employees’ portion of these taxes and withheld Federal Income Taxes are called “trust fund taxes,” because the employer is required by law to hold the taxes “in trust” for the United States.
IRC § 6672 Statutory Requirements
To be responsible under section 6672, you must have had the duty to withhold and remit the trust fund taxes and “willfully” failed to collect or pay over the tax due. See: Godfrey v. United States, 748 F.2d 1568 (Fed. Cir. 1984).
Q. Who is a Responsible Person for Purposes of IRC § 6672 Liability?
A. Any officer, employee, or member of an entity who had a duty to withhold and remit the taxes. See IRC § 6671(b).
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