Tax Day 2019 is six days away. 40% of Americans are unprepared to cover an emergency expense of $400. What do those two facts have to do with each other? More than it may seem at first glance.
As a bankruptcy lawyer Memphis TN trusts, I see a lot of folks struggling this time of year.
Every year, a significant portion of Americans is unable to pay what they owe the government. According to IRS data from 2019, 8.2 million men and women across the US had back taxes of $83 billion.
For some people who neglect their taxes, or put them off until the very last minute, procrastination is certainly a factor. But in other cases, people are simply unable to pay. The study I mentioned above found that 4 in 10 adults cannot cover an unexpected expense of $400 or more without selling something or taking out a loan.
Unfortunately, if you owe money, the IRS has the right to garnish your wages and place liens on your home. Avoidance is never the right way to handle your debt, but with taxes specifically, you will want to tackle the problem sooner rather than later. Thankfully, bankruptcy gives you a way to manage your tax debt and move forward with a better outlook for your finances.
Chapter 7 Bankruptcy and Tax Debt
A Chapter 7 bankruptcy, which eliminates all of your dischargeable debt, could help wipe away your taxes if they meet the following criteria.
- The tax must be at least 3 years old.
- It must be simple income tax.
- The returns must have been filed on time.
Chapter 13 Bankruptcy and Back Taxes
If your tax debt isn’t at least 3 years old, you can still use bankruptcy to make the situation more manageable. A Chapter 13 consolidation plan will help you get out of debt over time, with affordable monthly payments. In about 5 years, you’ll have a new debt-free life.
Talk to a Bankruptcy lawyer Memphis TN trusts today
Regardless of your circumstances, I can help you so that you’ll no longer have to worry about IRS collection efforts or seizure of assets.
If you’re ready to take control of your tax debt, call (901) 327-2100 to speak with the bankruptcy lawyer Memphis TN trusts or contact us here. We’ll look at your situation and discuss your goals — no strings attached.