Home > Research Legal Advice > Bankruptcy / Debt > I have a 10 year old tax debt to the IRS for $7000 can this be part of a...
Asked over 2 years ago - Streamwood, IL
FlagHow is a tax debt handled in a chapter 7.
Your 10 year old debt may well be dischargeable - so are you eligible for a chapter 7? If not, your non-priority tax debt would be treated as any other unsecured debt in the chapter 7 case. Under some circumstances, it might even be barred by a statute of limitation. You need to look at the tax transcript to determine and you'll want some legal advice.
The debt can be included, but its treatment will need to be carefully evaluated. If the returns were filed and the taxes assessed that long ago, they may be dischargeable in a Chapter 7 case or treated as unsecured debt in a Chapter 13 case. I suggest you order tax transcripts for the years involved.
The scope of this space does not afford an opportunity to assess the situation and advise you. I recommend you assemble for legal consultation: (1) your income information for February 2010 through the present, including wages and unemployment during that period; (2) all your bills (three months’ copies neatly assembled); (3) last four years’ tax returns; (4) a credit report (use www.annualcreditreport.com to obtain free report if not requested in last year); and (5) other information that may apply, such as copies of lawsuits. Call at your earliest convenience to afford the most opportunity in which to be advised about your best course. You are not required to use an attorney in your area.
I do not recommend filing bankruptcy on your own. There are too many complex issues. I have seen several posts on this site for debtors who filed on their own and are seeking counsel concerning complications. Most of them will have a hard time finding an attorney to get involved to unwind the mess without the attorney charging several times what would originally have been paid.
Yes, that tax debt can easuly be put into a 13. Contact my law firm and we can go through your situation and decide the best route here, thanks!
Please check the thumbs up button below if this answer is helpful to you, thanks!
Very truly yours,
Dean D. Paolucci, Attorney at Law
Select Legal, Practicing in Illinois and Ohio
Illinois> 312-427-9131
Ohio> 614-223-1235
Dean@SelectLegal.com
www.SelectLegal.com
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Assuming this tax debt is based on income tax and you filed the tax returns for the years in question, the taxes should be fully dischargeable in a chapter 7 discharge.
THESE COMMENTS ARE NOT LEGAL ADVICE. They are provided for informational purposes only. Actual legal advice can only be provided after consultation by an attorney licensed in your jurisdiction. Answering this question does not create an attorney-client relationship or otherwise require further consultation.
Chapter 7 bankruptcies are liquidations which discharge most, if not all, of your debts provided the court approves the bankruptcy plan. Chapter 13 reorganization bankruptcies are structured for you to pay your debts under a "plan," which can stretch out over a period of years, but you end up paying most of the debt off in the end. You should consider which option you would prefer for your entire bankruptcy in addition to thinking about the tax debt and consult a bankruptcy attorney for more advice.
Legal disclaimer: The above information is not legal advice and should not be relied upon as legal advice. No representations are made in the above communication nor may any information contained herein be used in a court of law as a representation upon which you may rely.
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