A corporation acts through its officers, which are presumed to have the duty to withhold employment taxes from wages and make the necessary disbursements to the government. Corporate officers are not automatically deemed responsible persons, rather, they must have the duty to collect, account for, and pay employment taxes. This generally includes corporate officers that control the overall affairs of the business and have the ability to determine which creditors to pay first. Any corporate officer that has the power and authority to ensure that withheld employment taxes are paid to the government will be considered a responsible person.
A common defense raised by corporate officers is that they have delegated their duties to others. However, corporate officers that have effective control over filing employment tax returns and/or paying employment taxes and other bills, cannot escape liability simply because these duties have been delegated to others.
Another common defense raised by corporate officers is that they were just following orders from a controlling party, such as the board of directors. Some courts will consider this defense, however, most will reject it on the basis that corporate officers have a fiduciary duty to pay employment taxes because the funds are held in trust for their employees. The duty to pay these trust funds over to the government remains regardless of any contrary instructions given by a controlling party.