Uncollectable Status

The Trust Fund Recovery Penalty, previously known as the "100% Penalty," is a collection tool which pierces the corporate veil and authorizes the IRS to go after officers, or other "responsible persons" of the corporation, for the unpaid portion of payroll taxes that was withheld from the employees and not paid to the IRS. Once assessed against an individual it is non-dischargeable in bankruptcy and has a ten-year collection statute like most other taxes which have not been reduced to a judgment. (Please link to The Trust Fund Recovery Penalty for a detailed discussion on the issue.