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What is the trust fund recovery penalty?

Updated October 8, 20261 sourceTaxTruce teamFact checked
The short answer

It is a penalty equal to unpaid trust fund taxes, the income tax and worker's share of Social Security and Medicare a business held back. It is charged to the people responsible. The IRS sends a letter first. You have 60 days to appeal.

Words to know

Trust fund taxes
Taxes a business holds back from workers' pay, like income tax and the worker's share of Social Security and Medicare.

Sources

  1. IRS: Employment taxes and the Trust Fund Recovery Penalty

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