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Can a manager of an LLC be held liable for unpaid sales taxes?

Can a manager of an LLC be held liable for unpaid sales taxes?

Q: Am I personally liable for LLC tax debt?

Typically, you are not personally liable for your LLC's tax debts if you are acting within your role as a manager. The LLC structure provides a level of protection against personal liability for business debts. However, if you have committed fraud or acted recklessly, you could be held personally responsible for those debts.

Q: Can a managing member of an LLC be sued?

Yes, a managing member of an LLC can be sued, but generally only for actions taken outside the scope of their managerial duties or for personal misconduct. If a managing member acts within their role and follows the law, they typically have protection from personal liability for the LLC's debts or obligations.

Full question:

Can a manager of an LLC be held liable for unpaid sales taxes for their LLC where there is a strong set of LLC management documents and a capital fund at the outset? The LLC lost a lot of money but taxes were not paid (form was filed) for 2009 and no filing in 2010 (but not closed until May). Thank you.

Category: Taxes
Date: 04/07/2025
State: Missouri

Answer:

In general, LLC managers cannot be held personally responsible for the debts of the LLC if they are acting in their capacity as a manager - even if they make mistakes / even if they are negligent (unintentional errors). However, if intentional wrongdoing (or a high level of recklessness) is proved, personal liability may attach, as intentional wrongdoing is outside the scope of their employment.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

Can a manager of an LLC be personally liable?

In general, LLC managers are not personally liable for the debts of the LLC, including taxes, as long as they act within their authority and do not engage in wrongful conduct. This means that if a manager follows the rules and makes decisions in good faith, they usually cannot be held personally responsible. However, if a manager acts with intent to deceive or is extremely negligent, they may face personal liability.