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Is my house subject to a franchise tax warrant?

Levittown, NY |

I set up a corporation out of my house for which I did not make any money. I just received a franchise tax warrant. What property if any property is subject to a lien as a result of this tax warrant?

Attorney Answers 3


  1. It would typically only be the assets of the corporation. However, if you dissolve the entity this could become a personal liability. More facts are necessary here to make any kind of real determination. You should contact a local tax professional and go over your specific facts and determine a course of action.

    Any individual seeking legal advice for their own situation should retain their own legal counsel as this response provides information that is general in nature and not specific to any person's unique situation. Circular 230 Disclaimer - Advice given in this response cannot be used to eliminate penalties with the IRS or any other governmental agency.


  2. None, except corporate property. Your corporation will be dissolved by the State for failure to pay franchise taxes. If you do not care about that result, then no one else will either.


  3. I agree with the other two attorneys who answered this question.

    I would like to add to the discussion. You mention that you set up the corporation out of your home. I am assuming that you own your home and have not actually transferred ownership and title of the real property from you personally to the corporation. Assuming that such a deed transfer never occurred, your home personally owned by you (and not the corporation) should be safe from outstanding "corporation franchise taxes" and the resulting tax warrant against the corporation. However, in any case, you should meet with an attorney to determine the proper answer according to your circumstances.

    Also, I assume the franchise tax warrant of the corporation was issued by the New York State Department of Taxation and Finance. This tax warrant is now a matter of public record.

    In any case, it is a very good idea for you to consult directly with a tax attorney to review the specifics of your situation and determine any current and potentially future personal and corporate liabilities. In addition, it is very important that no trust fund taxes of any kind (such as sales taxes and employment taxes) be owed by the corporation -- whether it be federal (IRS), New York State, any other state, and any locality. Compliance with trust fund taxes is very important. If the corporation does owe such trust fund taxes and does not pay them, then please be aware that this could result in you ultimately being held personally liable for those kind of taxes in addition to the corporation being liable. And it therefore follows that if you become personally liable, your personal assets are at risk in addition to the corporate assets of the corporation if liable.

    In addition to consulting directly with an attorney, please also refer to the IRS website (www.irs.gov) and the New York State Department of Taxation and Finance website (www.tax.ny.gov) along with the website of any other applicable governmental authority.

    Good luck and all best,

    Suzanne Alexandra Ascher, Esq., CPA, Tax LL.M.

    Legal disclaimer by Suzanne Alexandra Ascher, Esq: My answer is strictly for information and education purposes only and therefore my answer does not form any attorney-client relationship and attorney-client privilege between me and you. These questions and answers on AVVO.COM are no substitute for actual qualified legal advice by an actual licensed attorney in good standing with the bar who can become fully informed of your entire situation above and beyond the limited description of your situation in your question. Further, nothing posted in this public forum of AVVO.COM is deemed confidential or privileged communication. Finally, in accordance with IRS Circular 230 disclosure, federal (United States) tax advice provided in this communication is neither intended nor written to be used, and cannot be used, by to avoid penalties under the Internal Revenue Code or to promote, market, or recommend to anyone a transaction or matter addressed in this communication.

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