High-Stakes Payroll Tax Problems (941/940): How Mike Habib, EA, Resolves IRS Employment Tax Nightmares for Business Owners

IRS payroll tax problems can cripple a business and devastate its leadership. For business owners and corporations, few issues carry more legal and financial risk than Form 941 and 940 payroll tax liabilities. If your business is facing an IRS investigation, delinquency, audit, or collections related to employment taxes, this isn’t just a tax issue—it’s a crisis that demands immediate, expert-level intervention.

At Mike Habib, EA, we specialize in high-stakes tax representation for businesses, with over 20 years of success resolving IRS 941/940 payroll tax cases. We’re not just tax preparers—we’re federally licensed tax representatives, authorized by the U.S. Treasury to defend and represent business taxpayers before the IRS in all 50 states.

What Are IRS 941 and 940 Taxes—and Why Do They Matter?

Form 941 is used by employers to report income taxes withheld from employees’ wages and to pay the employer’s portion of Social Security and Medicare taxes.

Form 940 is used to report and pay Federal Unemployment Tax (FUTA).

These are not optional filings. They are federally mandated trust fund taxes, and failure to comply can lead to:

  • IRS levies and liens
  • Seizure of business assets and bank accounts
  • Closure of business operations
  • Personal liability for business owners and responsible parties (via the Trust Fund Recovery Penalty)

The IRS Takes Payroll Tax Problems Seriously — So Should You

The IRS considers unpaid employment payroll taxes one of the most severe violations in the tax system because the employer is holding money “in trust” for the government. Failure to deposit these taxes is seen as misappropriating federal funds.

And they act accordingly:

  • Revenue Officers are assigned to aggressively pursue collection.
  • Criminal investigations are initiated in extreme cases.
  • Business bank accounts and assets are levied.
  • The Trust Fund Recovery Penalty (TFRP) can make owners, officers, and even bookkeepers personally liable for the unpaid payroll taxes—regardless of corporate protections.

“The IRS does not tolerate payroll tax evasion. It is one of the few areas where the agency may pursue criminal charges.” — IRS Office of Enforcement

Common Payroll Tax Problems We Help Resolve

At Mike Habib, EA, we regularly assist businesses with:

  • Late or unfiled 941 or 940 returns
  • Missed payroll tax deposits
  • Trust Fund Recovery Penalty investigations
  • IRS Revenue Officer interviews and demands
  • Bank account levies and asset seizures
  • Payroll tax audits
  • Multi-year noncompliance
  • Negotiating settlements and repayment plans
  • Business closure risk mitigation

Real-World Example: From IRS Crisis to Resolution

Case Study:
A manufacturing company in California fell behind on payroll deposits during a downturn. The IRS initiated enforcement, threatening asset seizure and personal liability for the CEO. Mike Habib stepped in, halted collection actions, represented the business before the IRS, and negotiated a structured resolution that kept the business alive and prevented the TFRP from attaching to personal assets.

Result: Business saved, liabilities resolved, no personal exposure.

Our Process: How We Resolve 941/940 Payroll Tax Cases

1. Immediate IRS Contact and Case Control

The first step is protecting you from further damage. We contact the IRS on your behalf, establish professional representation (via Form 2848), and immediately stop collection actions like levies and garnishments.

We also communicate with Revenue Officers directly, ensuring all future interactions go through us—not you.

2. Full Case Review and Compliance Analysis

We examine your:

  • Payroll deposit history
  • Filed and unfiled 941/940 returns
  • Business cash flow and operations
  • IRS transcripts and notices
  • Risk exposure for TFRP or business closure

Our goal is to assess the total liability and identify the best route to resolution.

3. Bring You into Compliance

Before the IRS will agree to negotiate, the business must be in compliance. That means:

  • All unfiled 941/940 returns must be submitted.
  • Current deposits must be made timely.
  • New payrolls must follow IRS requirements.

We work with you or your bookkeeper to bring everything current.

4. Strategic Resolution Planning

We assess all legal resolution options:

  • Installment Agreement: A structured monthly payment based on ability to pay
  • Partial Pay Installment Agreement (PPIA): Pay less than what is owed over time
  • Offer in Compromise (OIC): Settle tax debt for less than the full amount (rare but possible with payroll tax debt under strict circumstances)
  • Currently Not Collectible (CNC): Temporary hardship protection from collections
  • Penalty Abatement: We request removal of penalties for reasonable cause

Each case is different. We tailor the approach based on your business’s financial position and legal exposure.

5. Negotiate & Finalize Resolution

Mike Habib, EA, handles the direct IRS negotiations on your behalf. Our firm is respected by Revenue Officers and IRS agents for our professionalism, accuracy, and advocacy.

We ensure:

  • Collection actions are paused or minimized.
  • You never have to face the IRS alone.
  • The best possible resolution is achieved under the law.

6. Ongoing Protection & Compliance

We don’t just fix your current tax issue—we help ensure it never happens again. We offer:

  • Quarterly reviews
  • Payment plan monitoring
  • Ongoing compliance check-ins
  • Tax planning to avoid future pitfalls

Our goal is to permanently remove the IRS as a threat to your business.

Why Choose Mike Habib, EA?

✅ 20+ Years of Experience with Business Tax Cases

Payroll tax resolution is not for generalists. Mike has resolved hundreds of complex 941/940 cases involving six- and seven-figure liabilities, Revenue Officers, and TFRP enforcement.

✅ Federally Licensed to Represent You in All 50 States

As an Enrolled Agent, Mike is licensed by the U.S. Treasury Department to represent clients before the IRS—no matter where your business is located. We serve clients nationwide via secure remote systems.

✅ A+ BBB Rating and 5-Star Reputation

Our firm has earned top ratings on Google, Yelp, and the Better Business Bureau. We are trusted by business owners because we deliver results with integrity, urgency, and transparency.

✅ Personal Service—Not a Call Center

When you call us, you talk to Mike—not a junior associate or a phone rep. Your case is managed by a licensed expert from start to finish.

Penalties and Risks for Businesses

If unresolved, 941/940 problems can lead to:

  • Business shutdowns
  • Bank levies
  • Asset seizures
  • IRS injunctions
  • Revocation of licenses
  • Civil penalties and interest
  • Trust Fund Recovery Penalty (personal liability for owners/officers)

The IRS can pursue the business and the individual, making fast, qualified representation absolutely critical.

What Is the Trust Fund Recovery Penalty (TFRP)?

The TFRP allows the IRS to pierce the corporate veil and hold owners, officers, and even staff personally liable for the withheld portion of unpaid payroll taxes.

This means your personal bank accounts, home equity, and assets could be at risk—even if your business is incorporated.

We fight TFRP assessments and help clients avoid or appeal personal liability.

Don’t Let the IRS Destroy Your Business

We’ve seen it too often—business owners waiting too long, ignoring IRS letters, or relying on unqualified tax preparers. By the time they seek help, collections are underway and options are limited.

Don’t let that be you.

If you’re behind on payroll tax deposits or have received any IRS notice about your 941/940 filings, call us immediately. The sooner you act, the more we can do to protect you and your business.

Who We Help

We represent:

  • Small and mid-size businesses
  • Startups and entrepreneurs
  • S-Corps, LLCs, and corporations
  • Nonprofits with payroll tax obligations
  • Construction, hospitality, medical, tech, trucking, and retail companies
  • Multi-state employers and high-risk industries

Schedule a Confidential Consultation

📞 Call Today: 1-877-788-2937
🌐 Visit Our Website: www.myirstaxrelief.com
🔒 Secure, Confidential, and Licensed Tax Help

“Payroll tax problems don’t go away on their own. We defend your business like it’s our own.” — Mike Habib, EA

Final Thoughts

If you’re a business owner facing IRS payroll tax problems, know this: You’re not alone—and you’re not without options.

With the right help, even high-stakes 941/940 issues can be resolved legally, efficiently, and without destroying your company. Mike Habib, EA, brings over 20 years of experience, federal licensing, and proven results to fight for you.

Get the IRS off your back. Get compliant. Get peace of mind.

Client Reviews

Mike has given us peace of mind! He helped negotiate down a large balance and get us on a payment plan that we can afford with no worries! The stress of dealing with the...

April S.

Mike Habib - Thank you for being so professional and honest and taking care of my brothers IRS situation. We are so relieved it is over and the offer in compromise...

Joe and Deborah V.

Mike is a true professional. He really came thru for me and my business. Dealing with the IRS is very scary. I'm a small business person who works hard and Mike helped me...

Marcie R.

Mike was incredibly responsive to my IRS issues. Once I decided to go with him (after interviewing numerous other tax professionals), he got on the phone with the IRS...

Marshall W.

I’ve seen and heard plenty of commercials on TV and radio for businesses offering tax help. I did my research on many of them only to discover numerous complaints and...

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