The COVID-19 crisis is expected to slow down as 2021 develops. The good news is this will allow many folks to return to work and refocus on their financial situation. The bad news is it will probably cause creditors to resume collecting on accounts more aggressively than they did last year. So if you’re in a tough financial spot, what’s the solution? As a Memphis tax lawyer, I can tell you that using your tax return to file for bankruptcy  is one of your best options to take control of your debt.

Bankruptcy can help your tax return go further than just paying off a few debts.

I’ve seen it thousands of times: filing for bankruptcy can bring lasting relief from debt and help people finally get their lives back on track. It can also be a powerful way to deal with all debts at the same time. For example, let’s take two families who both have $15,000 of credit card and medical debt:

Family A is about to receive a $5,000 tax refund. Like most people, they have the best intentions of paying their debt back. So, they use their return to try and pay back a few hundred dollars towards each of their credit cards and outstanding bills, and maybe even pay one in full. Now all the tax refund money is gone, and the family is still in debt for $10,000. However, the fees and interest on those unpaid bills and credit cards will continue to grow. Pretty soon, they will find themselves in about the same position they were in before. So what did using their tax return in this way accomplish? Unfortunately, not much. Plus, the family was unable to use the money for other needs, like clothing for the kids, medical visits, or car repairs. And at the end of the day, they are still in debt.

Family B is about to receive a $5,000 tax refund. After careful consideration, they decide to use their refund to file for bankruptcy. They pay an attorney to file a Chapter 7 bankruptcy and successfully eliminate all their credit card and medical debt. They also get to keep their car and their home, are able to pay for reasonable and necessary expenses for the family, and within 12 months improve their credit score. Their debt is gone and they’re able to focus on the future.

If you want to be like Family B and make the smartest, most effective decision to handle your debt, you need a Memphis tax lawyer you can trust.

A Memphis tax lawyer can help you wipe out debt permanently. Call today for a FREE consultation.

More than ever, 2021 is a time to move forward. If you are considering using your tax return to file for bankruptcy, or would like to explore other options around resolving your debt, contact us here, or call (901) 327-2100 to speak with one of our experienced and compassionate tax lawyers. We’ll look at your situation and make a plan for your goals — no strings attached.