My Old Employers Pension plan which had around $ 20 , 000 , this old employer filed for bankruptcy in Nov 2011 so they cancelled the option of lumpsum payouts so I couldn't cash out that $ 20 , 000… Only option that was available for us is monthly payments option of $ 100 . 00…I opted for monthly payment option… But everything was kept on hold since bankruptcy court has to decide on all the payments / plans etc…In July 2012 I settled my Debts… Since this $ 20 , 000 was not available for me and during the period I got my debts settled and it was only after 6 months in December 2012 bankruptcy court approved lump sum payments and terminated the pension plan and it became available for us . So should I include this $ 20 , 000 in my assets for INSOLVENCY Calculations ?
Tax debt does get listed on the bankruptcy schedules, usually under schedule E. However, Filing bankruptcy within a certain timeframe before or after the debts are forgiven can help avoid debt forgiveness tax debt. Check with a tax professional, like H&R Block and ask if they can eliminate the 1099 tax debt by quickly filing bankruptcy.