Preliminary Notice Requirement

Except for jeopardy conditions, precludes assessment of a Trust

Fund Recovery Penalty unless a notice has been mailed to the taxpayer advising of the IRS's intent to assess the penalty. This notice must precede any notice and demand for payment by at least 60 days.

In the case of an imminent tolling of the assessment statute, the mailing of this notice preserves the assessment statute for 90 days after mailing or, if there is a timely protest, 30 days after a final determination by the IRS.

Effective for proposed assessments made after 6-30-96.

Disclosure of Information When Multiple Persons Responsible for Penalty

Requires the IRS, in writing, to disclose to anyone determined to be a responsible person for the trust fund recovery penalty:

• the name(s) of any other person(s) determined to be liable for the penalty,
• any related collection activity, and
• amounts, if any, collected.

Requests for information must be received in writing.

Failure by the IRS to follow this provision does not absolve any individual from any liability for this penalty.

Effective on the date of enactment.

Right of Contribution from Multiple Responsible Parties

Allows a person held liable for the penalty to recover (as state law permits) from other persons held liable for the penalty (but who have not paid the penalty) an amount equal to the excess over the proportionate share paid.

The proceeding to recover must be entirely separate from any proceeding involving IRS's collection efforts.

Effective for penalties assessed after the date of enactment