Who Signs 941?

[Bjorn]

Sadly an S-corp owner has died in an accident.

The books are a mess. We found two quarters of 941 which have not been filed and certainly have not been paid.

Who should sign these 941s? There is about $5000.00 of money and about 40,000 of various bills. The final payroll was paid.

What is the best practice in this case? Do we need to pay the 941s before any other bills?

[Armando Beaujolais]

I don't have many answers, but the first thing that pops into my mind is to be very careful about anyone possibly stepping into trust fund recovery penalites. I'm not saying don't do it, just be careful.

[Bees Knees]

An advantage to being a corporation is that the liability of the business cannot pass through to the shareholders, except for the shareholder’s own malpractice.

If you have a single shareholder S corporation, and that shareholder dies, the liabilities of the corporation cannot pass through to the estate of the shareholder, unless the shareholder is guilty of malpractice. If the liabilities exceed the assets, the beneficiaries may want to disclaim any inheritance in the S corp stock. The IRS cannot go after any person under the Trust Fund rules if the responsible person is deceased, and no one steps up to the plate to take on that responsibility.

I would suggest getting legal advice to see if the corporate shield can stop the IRS and other creditors from going after the beneficiaries of the deceased if they disclaim all interest in the S corp stock.

[JON]

Who is going to sign the checks

If you issue checks to creditors other than payroll tax, you automatically step into the trust fund issue. Who hired you-why are you there. If the Corp is bankrupt let some else get appointed as trustee and they can hire you. Unless we are missing some information we are you involved??????????