IRS Form 4180, The Trust Fund Recovery Penalty Interview
A 4180 interview is part of the IRS's process for identifying a responsible person for unpaid payroll taxes. The purpose of this interview is to determine whether or not the IRS is going to assess a trust fund recovery penalty against you personally - so you need to take these interviews extremely seriously and make sure you're prepared. The IRS can hold owners but also company employees and even third parties responsible for this penalty.
If you can’t get out of a 4180 interview, you need to be prepared for what’s going to happen there. Basically, the agent is going to ask you a series of questions from Form 4180. To get ready, you may want to look at a copy of that form, but in the meantime, here’s what to expect during a TFRP investigation.
Key takeaways
- Form 4180 interview - used by the IRS to identify individuals to assess the Trust Fund Recovery Penalty against.
- During the interview, the revenue officer asks questions to determine if you were responsible for the unpaid payroll taxes and if you acted willfully.
- If the agency decides to assess the penalty, they will send Letter 1153 with a proposed TFRP assessment.
- You have 60 days to appeal the proposed assessment.
- Once the IRS levies a TFRP against you, your options are to pay or request a settlement. If you don't, the IRS can seize your assets.
What Happens at a Form 4180 Interview?
James Cha, CPA, CTRS shares crucial warnings and step-by-step guidance for navigating the 4180 interview process.
“The biggest mistake someone can make during a Form 4180 interview is attending it unrepresented, uncoached, and providing unprepared or excessive testimony. This can lead to self-incrimination or waiving critical rights without realizing it.”
“Always secure qualified representation early. Ideally, the representative should handle the interview without the taxpayer present. File Form 2848 (Power of Attorney) for civil penalties to ensure direct contact with the rep.”
“Before the interview, review Form 4180 thoroughly. Prepare precise answers and supporting documentation like payroll records and bank statements. A best practice is to pre-fill Form 4180 with accurate responses and send it to the RO — this avoids unnecessary elaboration that can hurt your case.”
“Never sign Form 2751 (Proposed Assessment) if you disagree — that waives your appeal rights. And if there’s any hint of fraud or criminal issues, consult a criminal tax attorney immediately. ROs may look friendly, but this is an enforcement action.”
Form 4180 interviews can happen in person or over the phone. The interview starts with questions about personal information like your name, social security number, phone number, and address. Then, the interviewer asks about your job title or your relationship with the business. They are trying to determine if you are responsible for the business not paying its trust fund taxes (aka FICA taxes and income taxes withheld from employees' paychecks), and if so, if you acted willfully.
The agency may also ask questions about your co-workers and colleagues to determine if they are responsible. Many of the questions on Form 4180 are yes-no questions, and then, the revenue officer may attach affidavits from you or other individuals to provide more context to those answers.
What Questions Are Asked at a 4180 Interview?
There is a checklist of questions that the interviewer works through. The questions are designed to reveal how you were involved with the company’s finances and payroll in particular. Expect questions such as the following:
- Are you responsible for setting financial policy for the company?
- Do you authorize payments for bills or creditors?
- Do you sign or send payroll returns? (Those are the quarterly returns you send to the IRS with the company’s payroll information.)
- Do you make payroll payments?
- Do you authorize payroll payments?
- Did you know the taxes weren’t being paid?
- Are you involved in the company’s electronic banking?
The agent may ask more pointed questions like if you have login information for online accounts, PINs for bank cards, or authorization to sign checks for the company. All of these questions help clarify your connection to the company’s financial matters.
James Cha, CPA, CTRS shares a detailed breakdown of how to prepare a client for a Form 4180 interview and avoid self-incrimination.
“To help a client prepare for a Form 4180 interview and avoid inadvertently establishing TFRP responsibility, the primary strategy is proactive, informed representation and meticulous preparation.”
“First, always secure qualified representation early. Revenue Officers must suspend the interview if a representative is requested. Ideally, the representative—not the client—should attend.”
“Next, pre-fill Form 4180 with accurate responses, review the questions, and rehearse answers in advance. Emphasize the legal definitions of ‘responsibility’ and ‘willfulness’—just performing tasks does not make someone liable.”
“Always gather supporting documentation like payroll records and bank statements. Send the completed form to the RO ahead of time to avoid open-ended questioning that can backfire.”
“Finally, never sign Form 2751 if you disagree with the assessment—it waives your right to appeal. And if fraud or criminal liability is even a remote concern, consult a criminal tax attorney immediately. Taxpayers often don't realize how high the stakes really are.”
Does the IRS Ask About Other Business Payments at a 4180 Interview?
One of the main issues the IRS considers when determining whether or not the company could have paid the trust fund taxes hinges on whether or not other bills were being paid. Expect some questions in that vein. For instance, did you personally pay other bills? Did you hear that other bills (mortgages, vendors, utilities, loans, etc) were getting paid? If so, who paid those bills and who authorized the payments?
To explain why the IRS is concerned about this, imagine you own a restaurant. You draft paychecks for your employees and withhold income tax and FICA taxes (Social Security and Medicare contributions) as usual. However, instead of paying the IRS, you use that money to pay your meat vendor. Even if you meant to eventually pay the IRS, this is not ideal. The IRS looks at this situation as if you are purposefully taking tax money.
What Is the Purpose of a Form 4180 Interview?
The purpose of this interview is to figure out who is responsible. The agent is trying to determine if you are responsible, but the agent is also trying to uncover the names of other responsible people in the organization.
Expect questions like the following: When did you become aware of the issue? What did you do when you heard about it? Did you ever hear stockholders, officers, or others talking about unpaid trust fund taxes or unpaid payroll taxes? Who handles the IRS paperwork in your organization?
If you use a third-party payroll company, there are a series of questions about that as well. In addition, if you don’t work for the primary company but you work for the payroll company, you will also get a special set of questions. In both cases, the questions concern how the funds are distributed to the payroll company and what the payroll company employees knew about the situation.
Luckily, you don’t always have to go through the interview process. It is possible to avoid a 4180 interview.
James Cha, CPA, CTRS explains why the IRS requesting a Form 4180 interview is one of the most serious actions they can take against a business associate or employee.
“The IRS requesting a Form 4180 interview is a highly serious collection action. It signifies that a Revenue Officer has been assigned to the case, which generally means it's a high-priority, ‘egregious’ tax debt, often involving business or payroll tax liabilities.”
“This interview specifically investigates an individual's personal responsibility and willfulness for unpaid Trust Fund Recovery Penalty (TFRP) taxes. If the IRS decides you're responsible, they can pursue your personal assets for collection—even if you're just an employee and not an owner.”
“Unlike standard collection notices, a Form 4180 interview is a critical investigative step that carries severe personal financial consequences. You should treat it with the same seriousness you would a legal deposition.”
What Happens After a Form 4180 Interview?
The IRS uses the information gathered during the interview to identify potential responsible persons and to assess if they acted willfully - both responsibility and willfulness are required for the TFRP to be assessed. If the IRS moves forward, it will send Letter 1153 proposing a trust fund recovery penalty against you. If you agree, you can fill out Form 2751 to consent to the assessment. Otherwise, you have the right to appeal.
If you consent to the penalty assessment, if the IRS denies your appeal, or if you don't respond to the proposed assessment on time, the IRS will assess the penalty. At that point, you need to work with the IRS to set up payments or apply for a settlement. Otherwise, the agency can start involuntary collections to go after your assets.
What to Expect During a TFRP Investigation
If you're an employee or a third-party, the interview request may be your first clue that the IRS is considering levying the TFRP. However, if you're the business owner, a general partner, the head of accounting, or someone in a more senior-level role, you may have heard that issues were happening long before you received the interview request. So, that you know what to expect, here's a quick rundown of what to expect.
When a business misses payroll tax deposits, the IRS's Federal Tax Deposit (FTD) system flags their account for review and assigns a revenue officer to the file. The revenue officer typically starts with a field call (aka an in-person visit) to the business. If the owner isn't there, the revenue officer will leave Letter 5664. The revenue officer may also send Letter 5857 to request a phone call with the business owner. If the revenue officer cannot come to a resolution with the business owner, they will note that the account has delinquent payroll returns and/or payroll taxes owed. Then, the IRS will start the collections process - if the business owner pays or sets up payments on the payroll taxes, the IRS will consider them to be in good standing.
If not, the agency will start the TFRP investigation process. Typically, that starts with gathering information about the business using Form 4181 to gather information about the business, its employees, and how it handles payroll. Then, the agency will start looking at individuals who may be responsible, and it will request Form 4180 interviews from a range of individuals associated with the company's payroll tax payments.
Martin Cantu Jr., EA shares a real-world case where strong representation prevented an unfair outcome during a 4180 interview.
“I represented an individual who had no ownership or bank debt liability—just a normal salary—but was still targeted by the IRS due to her senior title and professional designation.”
“The revenue officer was aggressive and, in my opinion, verbally abusive. I had to intervene and insist she stand down. They brought in another agent to play 'good cop.' This tactic is more common than people think in TFRP investigations.”
“I clarified my client’s role using her testimony and supporting case law, and raised the defense that the IRS risked losing in court. Eventually, the case was reassigned to a more senior agent who agreed she wasn’t responsible.”
“If she had gone into that interview alone, I believe the outcome would have been drastically different. These agents are experienced and persistent—they often twist statements or take them out of context. Always confirm everything in writing, and don’t assume good faith.”
As explained above, depending on how the interview goes, the IRS may assess a TFRP against you personally, and if that happens, the agency will have the right to go after your personal assets.
Real Stories About TFRP Interviews
The IRS has broad authority to assess the TFRP against individuals, but it can only do so if the following conditions are met:
1. The person was responsible.
2. The person acted willfully.
However, to identify people who meet these two elements, the IRS may reach out to a variety of people. In this Reddit thread, a secretary at a small business says that she has been contacted by the IRS about a Form 4180 interview. She explains her role in the company - she monitors the bank account balance, makes deposits, and initiates payroll as instructed by the owner, but she does not have the right to sign checks or make withdrawals from the company's bank account. Commenters assure her that she will be able to get through the interview without trouble and that the IRS likely won't see her as responsible, but they also tell her to hire an attorney to be on the safe side.
Martin Cantu Jr., EA shares a powerful case where strategic representation prevented a wrongful TFRP assessment against a client targeted unfairly due to her title.
“I represented an individual who had no ownership or bank debt liability—just a regular salary. But because she held a senior title and had a professional designation, she became an easy target for the IRS.”
“The revenue officer was extremely aggressive—at one point verbally abusive. I had to step in and demand she stop. She then brought in another agent to play ‘good cop.’ These intimidation tactics are sadly common in TFRP interviews.”
“We presented a clear narrative of the client’s actual duties and backed it up with supporting law. I raised the risk of litigation, and eventually got the case reassigned to a more senior agent. They agreed she wasn't responsible, and the penalty was never assessed.”
“Had she gone in alone, she almost certainly would have been steamrolled. The takeaway: never assume the IRS is being reasonable, and always confirm everything in writing. Your defense starts well before the interview begins.”
Tyrone J. Taylor, EA successfully defended a client who was wrongly targeted based solely on check-signing authority.
“I had a client who had check-signing authority within a partnership. The IRS assumed this meant he was responsible for payroll tax payments. But he had never actually signed checks or authorized payments from the business account.”
“He was a limited partner with no operational control. We were able to demonstrate that he didn’t have knowledge of the tax issue and had no role in day-to-day operations.”
“Because we proved his lack of willfulness and direct involvement, the IRS agreed not to assess the Trust Fund Recovery Penalty. It’s a good example of how surface-level authority doesn’t always equal liability — and how critical it is to present the full picture.”
Get Help With Form 4180 Interviews Now
Do not go through a Form 4180 interview on your own - instead, use TaxCure to find experienced representation to help you through this process. This interview is extremely important, and if you're not prepared, you may end up facing a TFRP assessment. The TFRP is 100% of the unpaid withheld taxes - with a big company, that could mean tens of thousands of dollars or even more in some cases. Although the IRS can assess this penalty against multiple individuals, they can collect it from a single person. For example, if the IRS assesses the TFRP against five people but you're the only one with income or assets, the IRS will go after you for the full penalty.
Once the TFRP is assessed, it can be very difficult to get out of - often, taxpayers' only choice is to pay the penalty under protest and then request a refund or file a refund suit in court. In all cases - whether you're facing a TRFP interview, have received a notice of proposed assessment, or are just worried about being labeled as a responsible person - you should reach out for help today. Do a search on TaxCure now and narrow down the results to find a pro who has experience with the TFRP.