If the successor fails to withhold consideration and the tax debt is unpaid after ten days, personally liable for the debt. Therefore, when there is no fund available from which a successor can withhold the amount of the tax debt, the obligation to withhold does not arise. In the instant case, Northern Lights contends that it was not in a position to withhold purchase consideration f rom Cox. Northern Lights - foreclosed on the Cox property and purchased it with an offset bid for the amount of Cox's debt. Obviously, consideration that can be diverted does not result from the making of an offset bid.
Diversion is possible only to the extent that a bid is made in excess of the debt owed.
On the specific facts in this case we are satisfied that Northern Lights' inability to withhold purchase consideration from Cox was bona fide . Therefore, Northern Lights had no obligation to withhold such consideration and should not have been assessed for Cox's unpaid taxes. Cox then built and operated a hotel on the property. The employer shall file the reports which the department prescribes and pay the contributions required by this chapter with respect to wages payable for employment up to the date of the occurrence of each contingency. The purchaser or successor in business shall withhold enough purchase money to cover the amount of contributions due and unpaid until the employer produces a receipt from the department showing that the contributions have been paid, or a certificate that no contributions are due.