Thursday, September 4, 2008

SALES TAX - From Personal Liability for Wisconsin Sales Taxes to Successor Liability.

I have written many posts on the issue of how the Wisconsin Department of Revenue can collect a business' sales tax liability from the individuals owning or operating that business. I also explained that the personal liability of any responsible person will survive the dissolution of a business. Liability for unpaid sales taxes will also survive the sale of a business.

For example, if a business owner sells the assets or the stock of his corporation (or other business form) but the business has not paid all of its sales taxes, that owner could still be personally responsible for the payment of the sales tax. Unfortunately, however, the buyer of the stock or assets of the business can also be responsible for the unpaid sales tax if he/she/it is unaware of the liability or does not take the right steps to avoid this “Successor Liability.”

In a series of posts that will follow, I will address successor liability for Wisconsin Sales Taxes and the procedures for avoiding this potentially costly obligation.

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