How Does Your IRS Debt Fit Into Bankruptcy and a Closed Business?
"False Hope...Despite assurances from our government leaders that a recession is not imminent, the rest of us are aware that one is imminent. The subprime lending crisis and rising gas prices have harmed a variety of businesses, particularly modest and independent enterprises. If you were a contractor in the construction industry, you would realize how dire the situation is.Tighten your harness...You no longer receive as much work as you once did. You cannot afford to pay your IRS taxes, which continue to accumulate. You owe money to other business loan creditors. Your business is rapidly declining, and you are falling with it.The perimeter is closing in...Currently, you are probably contemplating filing for bankruptcy; you may even be contemplating closing your business and selling its assets to pay off your creditors. In essence, you are in a precarious position. But even if you owe other creditors, the IRS continues to cast a shadow over everything. And the IRS is determined to collect your tax debt, regardless of whether you owe creditors or have filed for bankruptcy.Being straightforward...What is the relationship between a tax debt and bankruptcy? You've likely heard a few things about IRS debt discharge in bankruptcy. Some of them are genuine while others are false.What you must know...If you have lost your business, are drowning in debt, and are filing for bankruptcy, how can you include your IRS tax obligation?If you want your bankruptcy to be effectively discharged in a bankruptcy, the following requirements must be met: The tax liability must be from at least three years ago. Any debt incurred within the past three years is ineligible for bankruptcy. You cannot have any unfiled tax years, as this will disqualify your IRS debt from bankruptcy.· Your tax debt can not have derived from a fraudulent return. If you deceived on your taxes and were audited, the IRS will still collect.What if...? Even if I am unable to include my IRS debt in the bankruptcy, am I temporarily protected from the IRS? Yes and no...even if you do not include your tax debt in your bankruptcy, the automatic stay applies to all collection actions. A stay automatically prohibits all collection actions until the bankruptcy is discharged. Therefore, you are exempt from IRS collection procedures during your bankruptcy.What is the status of my tax refund? Do I receive them while in bankruptcy? Unfortunately, your refund goes toward paying off your tax debt with the IRS.They will delay...However, the IRS is very patient, and you may be in for an unpleasant awakening if you still owe the debt after the bankruptcy has been discharged or dismissed.Without protection...First, interest and penalties continue to accrue on your debt, so depending on the length of time you were in bankruptcy, your debt may have increased significantly. In addition, your time in bankruptcy extends the Statute of Limitations, which is the time the IRS has to collect your debt.Now you have conclusive evidence...Use it!
" - https://www.affordablecebu.com/
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"How Does Your IRS Debt Fit Into Bankruptcy and a Closed Business?"
was written by Mary
under the Finance / Wealth
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comments. The article was created on 03 June 2023
and updated on 03 June 2023