July 15th, this year’s deadline for filing taxes, is sneaking up on us fast. Throughout my decades of experience as a Memphis bankruptcy lawyer, I’ve met few, if any, people who actually enjoy the filing process, but for some, there’s a reward in the form of a refund. Others aren’t so lucky and owe the government. According to data from the U.S. Internal Revenue Service, more than 14 million Americans owed over $131 billion in back taxes, penalties, and interest in 2018.
COVID has compounded so many families’ already stressful financial issues. Understandably, many taxpayers are unsure how they will be able to pay what they owe this year. If that’s you, we can get you out of your financial struggles. Give us a call at (901) 327-2100 or contact us here to discuss your options with an experienced Memphis bankruptcy lawyer.
People fall behind on taxes through no fault of their own.
Sometimes people are simply negligent about completing the paperwork. Sometimes procrastination is at play. But by and large, I’ve met many hard-working folks fall behind on their taxes through no fault of their own. Given that many Americans lack a basic safety net, any type of life disruption—unexpected illness, unemployment, or divorce—can throw anyone off.
COVID is one of those unexpected disruptions taken to the extreme. It has pushed many of us to our limit. According to a TaxAudit survey, 61% of taxpayers fear that the economic fallout of the pandemic may force them into tax debt.
Here are some additional statistics.
- 61% of Americans worry that they’ll land in tax debt because of COVID.
- 27% of Americans on a payment plan with the IRS are afraid they won’t be able to make payments.
- 49% of Americans are concerned that they’ll be contacted by the IRS about their tax debt.
Tax debt won’t resolve itself.
Avoidance is never the way to resolve financial problems, but it’s particularly damaging with the taxes. The IRS is empowered by law to garnish your wages and place liens on your home.
No one needs any additional stress during these challenging times. Bankruptcy was specifically designed to offer lasting relief. It can help eliminate your tax debt. An experienced bankruptcy lawyer can make the recommendation for your situation.
Chapter 7
A Chapter 7 bankruptcy completely eliminates dischargeable debt, including credit card and medical debt. I can help clear your tax debts in a Chapter 7 if:
- The tax is at least three years old.
- It’s simple income tax.
- The returns have been filed on time.
Chapter 13 Bankruptcy
If your tax debt isn’t three years old, a Chapter 13 bankruptcy, which consolidates your debt into affordable monthly payments, may be your best bet.
Get out of tax debt today.
If you have tax debt, there’s no need to be ashamed. This is a time to move forward, and a Memphis bankruptcy lawyer can help you do that.