26 U.S.C. § 7501
Liability for taxes withheld or collected
Whenever any person is required to collect or withhold any internal revenue tax from any other person and to pay over such tax to the United States, the amount of tax so collected or withheld shall be held to be a special fund in trust for the United States. The amount of such fund shall be assessed, collected, and paid in the same manner and subject to the same provisions and limitations (including penalties) as are applicable with respect to the taxes from which such fund arose.
For penalties applicable to violations of this section, see sections 6672 and 7202.
Notes of Decisions
Cited in 421
cases (17 in the last 5 years), 1959–2026 · leading case: Begier v. Internal Revenue Serv., 496 U.S. 53 (1990).
Begier v. Internal Revenue Serv., 496 U.S. 53 (1990). “*60 B We begin with the language of 26 U. S. C. § 7501 , the Internal Revenue Code's trust-fund tax provision: "Whenever any person is required to collect or withhold any internal revenue tax from any other person and to pay over such tax to the United States, the amount of tax…”
Slodov v. United States, 436 U.S. 238 (1978). “" 26 U. S. C. § 7501 (a). There is no general requirement that the withheld sums be segregated from the employer's general funds, however, or that they be deposited in a separate bank account until required to be paid to the Treasury.”
Slobodian v. United States of Am. Internal Revenue Serv., 822 F.3d 144 (3rd Cir. 2016). “The District Court held that because Altus’s funds were held by Net Pay in a special statutory trust pursuant to 26 U.S.C. § 7501 (a), Net Pay had no interest in them.”
Gail McClendon v. United States, 892 F.3d 775 (5th Cir. 2018). “18 26 U.S.C. § 7501 (a). 10 Case: 17-20174 Document: 00514513428 Page: 11 Date Filed: 06/14/2018 No.”
Babcock v. United States, 807 F. Supp. 2d 904 (C.D. Cal. 2009). “, “[although an *910 employer collects this money each salary period, payment to the federal [Government takes place on a quarterly basis.”
Murray Drabkin v. Dist. of Columbia, Murray Drabkin, Tr. v. Dist. of Columbia, 824 F.2d 1102 (D.C. Cir. 1987). “Unable to show that anything resembling a trust existed in fact, the IRS argued that 26 U.S.C. § 7501 (a), which essentially mirrors the provision on which the District here relies, imposed a trust by operation of law: Whenever any person is required to collect or withhold any…”
LSF FRANCHISE REO I, LLC v. Emporia Restaurants, Inc., 152 P.3d 34 (Kan. 2007). “Because federal law requires employers to hold these funds in ‘trust for the United States,’ 26 U.S.C. § 7501 (a), these taxes are commonly referred to as ‘trust fund’ taxes.”
Erwin v. United States, 591 F.3d 313 (4th Cir. 2010). “26 U.S.C. § 7501 (a) (2006). Accordingly, courts often refer to the withheld amounts as "trust fund taxes"; these monies exist for the exclusive use of the government, not the employer.”
United States v. Whiting Pools, Inc., 462 U.S. 198 (1983). “Although it may well be that funds that the IRS can demonstrate were withheld for its benefit pursuant to 26 U. S. C. § 7501 (employee withholding taxes), are excludable from the estate, see 124 Cong.”
Raymond Nakano v. United States, 742 F.3d 1208 (9th Cir. 2014). “With that text, Congress passed, and the President signed into law, a mandatory deferral of carriers’ quarterly excise tax due date from on or after September 11, 2001, until November 15, 2001, or until January 15, 2002, at the discretion of the Secretary of the Treasury.”
John A. Thibodeau v. United States, 828 F.2d 1499 (11th Cir. 1987). “§ 7501 (codified at 26 U.S.C. § 7501 ), and no instruction by the owner or CEO of a corporation may “effectively bar an otherwise responsible officer from paying these funds in accordance with the law.”
Brewery, Inc. v. United States, 33 F.3d 589 (6th Cir. 1994). “1987); see 26 U.S.C. § 7501 . Since the Bogey Inn had a weekly tax liability exceeding $3,000, it was required to make weekly deposits of the federal employment taxes due from the previous week.”
— 26 U.S.C. § 7501(a) — 2 cases
In Re Gregory Mobile Homes, Inc., 347 F. Supp. 528 (M.D. Ga. 1972).
United States v. NEWMAN (D. Me. 2025).
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