Tag: Bankruptcy

Making Filing Much Easier

Filing Back Taxes

The approach that you take when filing back taxes will make a very big difference in your life. It is important for you to avoid putting off dealing with your taxes, this is a mistake that many people make. If you allow time to pass, you run the risk of forgetting and having to deal with panic that results from an approaching deadline. As such, you want to take advantage of software that would help you to streamline the process of dealing with your 2008 taxes. All you will need to do is enter your financial information and answer a few questions. These questions are designed to help determine how much you are responsible for while limiting your financial burden. The process is very quick, it will allow you to get rid of the stress that comes along with having to file back taxes.

Tax Preparation
Tax Preparation (Photo credit: agrilifetoday)

Additionally, you may want to speak with a professional that would be able to look at your financial situation in order to determine your liability. People tend to think that they do not need help when it comes to dealing with taxes. However, this is simply not the case. Following the guidelines set forward is the only way that you will be able to avoid making a mistake. Software can help to safeguard you while reducing the amount of time that it would otherwise take to get this portion of your life in order going forward.

Related articles

Can You Discharge Your Tax Debts In Bankruptcy Court

There are many debts that you can discharge through bankruptcy. Is tax debt eligible for discharge through bankruptcy? In some circumstances, a taxpayer can go to bankruptcy court and have an old tax debt discharged. There are criteria that have to be met for that to happen.

The Debt Was From A Tax Year At Least Three Years Ago

A petitioner facing a judge in bankruptcy court today would only be eligible for relief from taxes filed before 2009. Any other tax debt would be ineligible for discharge in bankruptcy court. The 36 month period starts on the day that your tax debt was due. Any extension of your due date will extend the amount of time you have to wait before that debt becomes eligible for discharge.

The Tax Return Was Filed At Least Two Years Ago

Taxes that were filed after 2010 would not be eligible for discharge at the current time. Any recent tax debt would not be eligible for tax relief until 24 months after filing. The 24 month time period begins on the day that you actually file your tax return. Tax returns that were not filed will not qualify for discharge no matter how old that debt may be.

Your Tax Debt Must Be At Least 240 Days Old

The tax debt must be assessed at least 240 days before you can ask for the debt to be discharged. It does not matter in what manner the tax was assessed against you. However, it might be easier to get the debt discharged if the tax assessment was a result of self-reporting of taxable income.

The Return Was Filed In Good Faith

A judge is not going to discharge any tax debt based on a falsified tax return. Attempting to evade taxes is not an acceptable basis to have your debts discharged. The IRS will help to determine whether the returns were filed in good faith or not.

Your Creditors Will See Your Returns

It is important that the borrower files their taxes on time each year. The bankruptcy court is going to ask for your last four tax returns. Your creditors are going to have access to any tax information that you hand over to the court. Furthermore, you would have needed to have your tax return filed before you first met with any debt relief services. You may not be able to reach a tax debt settlement if you did not file your taxes before seeking relief.

It is possible that your tax debt could be discharged. However, you have to make sure that you were actually filing your tax returns in an honest manner. Tax debt may not be eligible for discharge if you are simply trying to evade payment of taxes. Do plenty of research before you seek any relief from past tax debt. The courts will not be likely to discharge your debt if you do not follow all of the rules. Ignorance of the law is never a defense.

Related articles

Tax Refunds and Bankruptcy

When it comes to making the decision to go bankrupt, you need to be aware of just what the benefits will be.  If wiping your financial slate clean means that you will lose your house, savings, and assets, perhaps it would be best to consider other options.  When it comes to tax refunds and bankruptcy, here are some tips to protect the money owed to you by the government.

First of all, you should be aware that your tax refund can be a part of your bankruptcy estate, meaning that the court-appointed trustee has access to it and can part or all of it to pay off your creditors.  It is the part of the refund that was accrued the date of petition that belongs to the bankruptcy estate, therefore, the time of the year that you file bankruptcy makes a big difference to the amount of money you are due to receive.  If you submitted a joint married tax filing but only one of you is claiming bankruptcy, the joint tax refund may be at risk.

•    Change your exemptions – if you usually receive a large tax refund and are thinking about filing bankruptcy in the future, increase you exemptions to reduce the amount of money to be refunded.

•    Delay your petition – unless you are facing an immediate foreclosure, lien, or garnishment, delay filing for bankruptcy until you have received your refund then use it to buy necessities.

•    Submit a W-5 – Your Advanced Earned Income credit can be transferred to you on a weekly, monthly, or quarterly basis.  This ensures that you can receive it and spend it without losing it during bankruptcy.

Dealing with tax refunds and bankruptcy can be especially stressful as you obviously don’t want to lose any more than absolutely necessary.  Consult a qualified bankruptcy attorney to discuss options of how to hold onto your tax return.

For more information about filing personal bankruptcy, please visit claimingbankruptcy.net.

Related articles