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Lev, Tax Advisor
Category: Tax
Satisfied Customers: 29975
Experience:  Taxes, Immigration, Labor Relations
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If a business closes its dorrs (corporation is not dissolved

Customer Question

If a business closes its dorrs (corporation is not dissolved yet), can the corporation be absolved of NYS unemployment contributions due from an audit and from a quarterly report?
Submitted: 2 years ago.
Category: Tax
Expert:  Lev replied 2 years ago.

As long as the corporation is not dissolved - it is legally exists while it might stop business operations.
The corporation is still liable for the debts - including unemployment taxes.
The issue is not to relief the corporation from the debt - but whether corporate officers may be personally held responsible.
However - when the corporation is dissolved and there is no money to pay the debt - there would not be to an issue.

Customer: replied 2 years ago.

the corporation cannot be dissolved due to owed sales taxes (which will be paid off). can the unemployment taxes attache to shareholder personally? how about payroll taxes which are not the trust fund portion?

Expert:  Lev replied 2 years ago.

Indeed payroll taxes paid by the corporation are classified as the trust fund money.

Expert:  Lev replied 2 years ago.
Shareholders are NOT responsible for any corporate debts - that is the main principle when the corporation is treated as a separate legal entity.
The officer of the corporation may be held personally responsible - if the money or other assets were distributed instead of paying these debts.
If there were NO distributions - there would not be personal responsibility.