Who's responsible for taxes in an LLC?

What is the name of your state? FL

I have a tax question. My partners and I opened an LLC in Florida a year and a half ago. There were 6 people involved. My wife and I invested ~ 55%, my sister and her husband ~ 40%, and my brother and his wife ~ 5 %. The business closed this past May and we owe ~ $11,700 in 941 taxes.

We are personally filing a chapter 7 bankruptcy and have listed the IRS (941 taxes) and FL Dept of Revenue (Sales Tax). The couple that owns ~ 40% is also filing personal bankruptcy (a chapter 13) but did not list any taxes. They are telling us they don't owe any...they say we are responsible for all of it since we are majority owners. They listed us in the bankruptcy and we believe the only reason why is so we can't get an money by suing them for the taxes they owe if we pay them all.

Is this correct? Are they not responsible for any taxes? Should they have listed the IRS and Dept of Revenue in their bankruptcy? Will the IRS and Dept of Revenue go after them as well as us, or just us? We plan on setting up a payment plan after our bankruptcy is over, but only for our share...55%.

The BR will have no affect on the payroll taxes as far as your personal responsibility is concerned. The IRS will likely assess the Trust Fund Recovery Penalty against some or quite possibly all of you for the unpaid employee portion of fica/medicare as well as the employees federal tax withholding. They will collect it from whomever they can get it from. The penalty is not dischargeable in a BR.

All that said, some of you may not be responsible for the taxes. It is a facts and circumstances analysis depending on who had responsibility for withholding and paying over the taxes. Ownership percentage will have nothing to do with it. I suggest you get help on this using a seasoned professional.

I posted this reply on your other thread!

Who was responsible for paying the taxes? You can’t get out of paying the taxes through bankruptcy. In my case, I was the officer that handled the payment of all taxes, and was responsible. I am the one paying back all taxes.

Ultimately, all members of the LLC bear some responsibility regarding the trust fund taxes (payroll taxes) however the IRS will primarily go after the person who signed the 941's and the payroll checks, and who was responsible for actually handling the money.

The legal theory is that whoever handled the money knew, or should have known, that the trust fund taxes had priority over any other expenditures. You don't pay for rent, product, utilities or anything else unless the trust fund taxes have already been paid.

As you have already been told, those taxes cannot be discharged in bankruptcy. However, if you are filing a chapter 13 BK, they can be included in the payment schedule. However, all of them should be included, not just 55%.

By going 13 and including the taxes, all you have to pay is the taxes, the penalties and interest go away!