Resolving IRS Tax Debts
Determining how to resolve tax liability can be stressful. Maybe you have received threatening letters from the IRS? Or maybe they even taken the step of pursue a levy? You need answers and advise you can rely on. Our firm specializes in debt resolution and we can assist you in settling your IRS tax debt in addition to other debts you may have.
When you meet with one of our experienced attorneys, we will advise you on your available options:
- Which tax debts are eligible for total elimination;
- How we can consolidate and reorganize tax obligations that are not available for straight elimination;
- Other options you may have for restructuring your budget and reducing or eliminating your debts;
- How you can improve your credit by resolving your debts.
Call us today at 866-261-8282 to speak to a licensed attorney about your IRS tax issue and other debts obligations. We have six convenient office locations in: Detroit, Southfield, Warren, Dearborn, Ann Arbor and Flint, Michigan. We offer free in-office or phone consultations to answer your questions and provide qualified legal advice.
Eliminate Older IRS Tax Debt
Income tax debt incurred more than three years ago can generally be treated as unsecured debt through the filing of a Chapter 13 Reorganization or a Chapter 7 Fresh Start. In the event of a Chapter 7 filing, this unsecured debt would be legally eliminated through the program. Once the Chapter 7 is filed, you are protected from any further IRS collection efforts or levies on these aged tax debts. Within four to five months, you will receive a full discharge from all your unsecured debts and can start with a clean slate.
There are certain stipulations to eliminating older tax debts, such as when you actually filed your taxes, which you will need to discuss with our attorneys at the time of your initial, free consultation. At that time, we will develop the best plan to resolve your IRS or other Tax debts.
Reorganize Current IRS Tax Debt
In the case of Chapter 13 Bankruptcy, you are able to reorganize your tax debts regardless of whether they are current or older liabilities. The plan has a built-in structure to re-pay and prioritize you budget based on the type and age of the debt:
- Secured debt obligations, such as your mortgage or vehicle payment, take top priority in the budget plan.
- If you behind on payments for secured debts, we can set up repayment on the arrearages at 0% interest and defer payments on your tax debt until these obligations are brought current.
- Current tax obligations, those incurred within the past three years, are paid with priority status. Although this debt is not eligible for discharge, we can most often reduce payments to unsecured creditors to allow room in your budget to pay and resolve your current tax debt.
- Older IRS tax debts, typically over three years old, are categorized as unsecured debt and take the lowest priority in the repayment plan. Unsecured debts, including your older tax debts, will be:
- Consolidated and likely reduced;
- Paid back at 0% interest;
- No additional late fees or penalties;
- Any unpaid balances will be eliminated with a court discharge at the completion of the program.
What is a Chapter 13 Bankruptcy?
The Chapter 13 program offers a comprehensive debt consolidation plan that is tailored to your circumstances and budget. You are only required to pay your “best efforts” towards unsecured debts over the course of the 36 – 60 month program. The remaining unsecured debt is eliminated or discharged at the completion of the program.
You have full court protection from the IRS and your creditors while you are in the repayment program – no more phone calls or threatening letters. Other benefits of the Chapter 13 plan include:
- Legal protection from your creditors.
Stop creditors actions such as home foreclosure, vehicle repossession, collections, judgments, wage garnishments, etc.
Through the Chapter 13 plan you can:
- Eliminate a second mortgage or home equity loan;
- Reduce a vehicle payment;
- Reduce principal mortgage balance on rental property to fair market value.
The Chapter 13 is a personalized repayment plan based on your income and your budget. We propose the terms of the plan and are able to prioritize and balance your budget to take the stress out of monthly bill paying.
The Chapter 13 plan works to improve your credit by:
- Focusing repayment efforts on principal debt, therefore reducing your debt-to-income ratio as you move through the plan.
- With a structured repayment hierarchy and plan, the court appointed Trustee will restore timely payments to your creditors.
- The above two factors influence 65% of your credit score according to FICO. For added credit benefit, the Chapter 13 plan provides protection from late reports to the credit reporting agencies.
Don’t lose another night’s sleep worrying about IRS tax and other debts. Call our firm at 866-261-8282 for a free consultation and legal advice on your best debt resolution options.
We offer free in-office or phone consultations to review your personal circumstances, analyze your situation and advise you on the best course of action. We specialize in bankruptcy law, debt resolution, foreclosure prevention and credit repair. We have offices in Detroit, Southfield, Dearborn, Flint, Ann Arbor and Warren, Michigan. Please call us toll free at 866-261-8282 or click here to schedule a consultation right now.