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IRS Letter 1153 & Form 2751 - Proposed Assessment of the Trust Fund Recovery Penalty

An IRS Letter 1153 is a Trust Fund Recovery Penalty (TFRP) assessment against a business or responsible party. If you received a Letter 1153, the IRS has determined that you are responsible for an assessment for unpaid payroll taxes. If your business received an IRS Letter 1153 in Maryland, contact Juda Gabaie at Gabaie & Associates, LLC for help. 

What is an IRS Letter 1153 and Form 2751? 

If an employer has not paid federal withholding taxes, the IRS may issue a Letter 1153 assessment and Form 2751. The business or employer is supposed to collect, hold in trust, and pay to the IRS FICA taxes, including Social Security and Medicare. Willful failure to collect and pay those employment taxes can result in a TFRP assessment.

The IRS issues the letter to the “responsible person” who is an individual liable for failure to collect and pay employment taxes to the IRS. The responsible person “includes an officer or employee of a corporation or a member or employee of a partnership.” 

A Form 2751 is issued along with the Letter 1153 and provides for agreeing to the assessment. If the responsible person agrees with the TFRP assessment and signs the Form 2751, the IRS will request full payment form the responsible person. If the taxpayer is unable to make payment in full, an installment option may be available.  

Next Steps After Receiving a Letter1153 From the IRS 

The party receiving a Letter 1153 can take one of the following actions: 

The Letter 1153 advises the responsible person of his or her rights to appeal. If the responsible person does not agree with the assessment or has questions, he or she has 60 days to respond to preserve their appeal rights. 

Failing to respond may result in penalties or liens. As soon as possible after receiving a Letter 1153 from the IRS, you should contact your Maryland tax attorney to understand your options and if you can challenge the proposed assessments. 

How Long to Respond to an IRS Letter 1153?

In most cases, the responsible party has 60 days from the date of mailing on the notice or date of personal delivery to respond to the IRS Letter 1153, (75 days if the letter was addressed outside of the U.S.).

If the party fails to respond within the time limit (60 days or 75 days, plus 5 days to allow the IRS to receive and process all timely mailed protests), then the case will be considered unagreed.

Regardless of the taxpayer's response, the revenue officer will complete Trust Fund Recovery Penalty processing and forward the case within 30 days after the required response period.  

Questions About Your IRS Letter for Maryland Tax Lawyer 

If you received a Letter 1153(DO) from the IRS and have questions or concerns before signing a Form 2751, contact Gabaie & Associates, LLC  for a free consultation. Contact Juda Gabaie online or call (410) 862-2198 for help with your IRS or Maryland tax issues.

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Time is of the essence when it comes to tax-related issues. If you are uncertain as to what your next step should be, contact the reliable tax attorneys at Gabaie & Associates, LLC today.