Halloween is just around the corner, and if you thought this year could not get any scarier, think again. Failure to remit your business’ taxes to the state may result in a personal visit by the Office of the Texas Comptroller or Texas Attorney General. Several provisions of the Texas Tax Code impose personal liability on individuals associated with a business. Those individuals are typically (although not always) people with authority and power to make decisions related to a business’ operations, finances, and/or tax obligations. The following is a list of key tax provisions demanding personal liability:


(a) Any person who receives or collects a tax or any money represented to be a tax from another person holds the amount so collected in trust for the benefit of the state and is liable to the state for the full amount collected plus any accrued penalties and interest on the amount collected. . . .

(b) With respect to tax or other money subject to the provisions of Subsection (a) or (a-2), an individual who controls or supervises the collection of tax or money from another person, or an individual who controls or supervises the accounting for and paying over of the tax or money, and who wilfully fails to pay or cause to be paid the tax or money is liable as a responsible individual for an amount equal to the tax or money not paid or caused to be paid. The liability imposed by this subsection is in addition to any other penalty provided by law. The dissolution of a corporation, association, limited liability company, or partnership does not affect a responsible individual’s liability under this subsection.[1]

            Franchise Taxes

(a) If the corporate privileges of a corporation are forfeited for the failure to file a report or pay a tax or penalty, each director or officer of the corporation is liable for each debt of the corporation that is created or incurred in this state after the date on which the report, tax, or penalty is due and before the corporate privileges are revived. The liability includes liability for any tax or penalty imposed by this chapter on the corporation that becomes due and payable after the date of the forfeiture.[2]

            Fraudulent Tax Evasion

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