Hello, I wanted to seek legal advice regarding owed Taxes to the IRS if the business, a California corporation, files for Chapter 7 or 11. Will the owners be liable for owed taxes on the business entity?
Hello and thank you for your question here on Just Answer.
Yes, the owners of a corporation are personally liable for any IRS debts incurred by the business.
When a corporation files for bankruptcy it does not get a discharge. The discharge is the court order saying you do not owe the money any more. Therefore, when a corporation files bankruptcy the debt does not go away and you would still be personally liable for it, in this case with the IRS.
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