Family business conflict involving the IRS?
Our family owns an office building together. I did not pay my taxes due to personal problems for many years. The IRS agent, who said he would give me over a year to resolve the problem myself after I explained that I had a terrible relationship with my family, and that I was unemployed, went ahead and contacted my family about the debt. The family/partnership members have called a partnership meeting for tomorrow, Monday, and I am unable to attend due to some temporary work. I responded to that effect this past Thursday, but the meeting date has not been changed. Is this legal?
One of my family members, according to the IRS agent, asked if the business paid off my tax debt, could I then be ousted as a partner. He told them he didn’t think so according to the LLC Operating Agreement. My share is worth far more than the tax debt and it was alarming to hear that this family member would try to take my equity away. This same family member mentioned that my share of the office building would be discounted by 40% due to the share being part of a partnership. I spoke to an appraiser who said that the most a building would be discounted was 20 to 25% and that 40% was outrageous. Any advice? Thanks!
They can take you to court. If the irs puts a lien or levy on the building .it will affect their share also. You need to get with the family with a lawyer and try to make a compromise with them. Their property is at risk because of your tax debt.
Christine EA Master Tax Advisor
This advice was prepared based on our understanding of the tax law in effect at the time it was written as it applies to the facts that you provided.
http://www.hrblock.com/tax_professionals/christine_wilkins.html
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you owe money period. I think that they can sue you in court to reduce your share of the LLC according to the debt owed.
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You need to get a lawyer, and have the lawyer contact your family members if you aren’t willing or able to do it. What did you expect them to do, just sit and watch their office building be taken for YOUR failure to pay the taxes you owe?
There’s no law preventing them from meeting whenever they want to, and talking about whatever they want to. Your lawyer can advise you on what your and their rights are as far as ousting you from the partnership.
You don’t have a very good bargaining position right now, you know
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Advice? You need an attorney. NOW!
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They can take you to court. If the irs puts a lien or levy on the building .it will affect their share also. You need to get with the family with a lawyer and try to make a compromise with them. Their property is at risk because of your tax debt.
Christine EA Master Tax Advisor
This advice was prepared based on our understanding of the tax law in effect at the time it was written as it applies to the facts that you provided.
http://www.hrblock.com/tax_professionals/christine_wilkins.html
References :