Hello. I'll try to provide you with this information. To whom is the IRS notice addressed? The LLC or the members by name? Are you the Managing Member designated by the Operating Agreement. What does the Operating agreement say, if anything about Member liability?
I haven't seen the notice yet. i guess it's for the LLC. My partner hasn't provided me a copy of the notice. The notice was sent to his address.
Our relationship has strained and so is not co operating with me.
The operating agreement has an indemnification clause that indemnifies the TMP but only if the majority of the votes support.
In our scenario our LLC is deadlocked (50% each).
My partner is saying I committed a breach of fiduciary duty since I didn't inform him about the tax return before signing.
Since the error is huge ($40K in 2011 and $160K in 2012), would IRS assess a fradulent/negligent penalty even though we amended our tax returns voluntarily?
Our original CPA had made several errors - for eg deducted expenses even though the business hasn't opened yet.
Isn't it the fiduciary duty of my partner to share IRS notices? Will the IRS come after me (as TMP) or the LLC if we don't pay the penalty before the deadline?
Thanks for the fiduciary duty link.
Regarding my earlier question:
>Isn't it the fiduciary duty of my partner to share IRS notices? Will the IRS come after me (as TMP) or the LLC if we don't pay the penalty before the deadline?
I am concerned if I will be in trouble if we don't pay the penalty before the deadline. If the IRS assess penalties, would all the members of the LLC be responsible or just the TMP (I was the TMP for the original returns)?
Actually our LLC has 4 members = 2 couples.
My partner is blaming me for the incorrect tax returns and I am afraid he may file a lawsuit against me regarding this. In the eyes of IRS aren't all members of the LLC liable?
The CPA who we hired for amending tax returns is a close friend of my partner. Isn't the duty of this CPA to defend the LLC?
I am concerned if my partner and the CPA (who amended tax returns) would join together and get me into trouble with the IRS. Is this possible? If so, what actions should I take? Do I need to hire an attorney?
One final question/clarification.
I have already amended my personal tax returns and paid all taxes, interest and penalty.
So, at the LLC level, since there's no taxes, can IRS assess penalty on the original tax return (that was already amended)?
We amended all our tax returns (both LLC and personal) voluntarily and never received any notice or audit from the IRS/
Sorry for not being clear.
What I am referring to is the penalty at the LLC level.
Can they assess penalty on the original partnership return that was already amended? Since IRS knows there were errors in the original partnership return, why should they review the original return and assess penalties?
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