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Home / Courts / 4th Circuit / Taxation – Corporate – Business Sale – Back Taxes – Buyer’s Obligation (access required)

Taxation – Corporate – Business Sale – Back Taxes – Buyer’s Obligation (access required)

Starnes v. Comm’r of Internal Revenue Four former owners of a trucking business who sold their stake to a company that in turn sold it to another buyer, without following through on an agreement to pay taxes the former owners owed on the sale proceeds, do not have to pay the back taxes to the IRS; the 4th Circuit upholds a Tax Court decision that the IRS could not collect from the former owners because, under the controlling state law, a creditor of the buyer company could not recover on the buyer’s company debts.

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