I lost my business due to divorce and have a judgement by my ex who is very litigious which is how I lost my business. I have filed back taxes for the past 5 years personally and for the business and owe a significant amount but have no means to pay. I have half custody of our minor child and want to maintain that so I don't lose her. I am looking for a job but want to avoid garnishment if possible. Is it better to file bankruptcy?
Garnishment is enforced collection. Stay out of this process by entering into a payment arrrangement, Offer in Compromise, or being put on uncollectable status. These are viable options that you need to explore ASAP. Consult with a tax professional to see what will work best for you. If you would like we offer a free consultation to review your matter and make suggestions.
H. Daniel Lively, Esq., LL.M., CPA Certified Tax Specialist, CA Board of Legal Specialization firstname.lastname@example.org www.USTaxRescue.com 714-708-2593 Mr. Lively is a Certified Tax Specialist by the State Bar of California Board of Legal Specialization. He can be reached at 714-708-2593 or USTaxRescue.com.Any individual seeking legal advice for their own situation should retain their own legal counsel as this response provides information that is general in nature and not specific to any person's unique situation. Circular 230 Disclaimer - Advice given in this response cannot be used to eliminate penalties with the IRS or any other governmental agency.
As Mr. Lively mentioned the way to avoid garnishment is to enter into an agreement with the IRS. It is best to retain counsel such as a tax attorney or CPA to help you negotiate a resolution with the IRS. In these cases it is best to be proactive rather than to wait for the IRS to begin collection action.
Andrew B. Gordon
Andrew B Gordon is a CPA and attorney licensed to practice law in Illinois. The information provided here is for educational purposes only and is not intended as legal advice for a particular matter. This response does not create any attorney-client relationship with the author. For specific advice about your particular situation, please consult an attorney.