How To Eliminate Your Tax Debt: Bankruptcy Solutions For Tax-Burdened Individuals
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Transcript of How To Eliminate Your Tax Debt: Bankruptcy Solutions For Tax-Burdened Individuals
How To Eliminate Your Tax Debt: ���Bankruptcy Solutions For Tax-Burdened Individuals
BURDENED BY OLD TAXES?
Presented by Markowitz O'Donnell, LLP
Perhaps you are one of the people who have
been told by well-meaning friends and family
that you cannot get rid of taxes in bankruptcy.
While true in some cases, in
many cases it is not. You can
indeed eliminate tax debt
under certain circumstances
in bankruptcy.
In other circumstances
involving a single lump sum, you
can use bankruptcy to spread
that amount over a number
of years.
At the firm of Markowitz O’Donnell, LLP, we want you to know the truth about what bankruptcy can do for you when it comes to managing your tax debt.
In this presentation, we will discuss:
! The timing involved in filing taxes
! The timing involved in filing the bankruptcy petition itself
! The need for careful exemption planning
! Protecting a tax refund
When It Comes To Taxes, Time Does Matter
A primary consideration in eliminating taxes involves how old the taxes are.
The newer the taxes, the more unlikely it is you can eliminate them
(though you can use bankruptcy to break large sums into manageable
monthly payments).
As you might imagine the timing and age requirement for taxes can be
complicated and are addressed more exhaustively in our free white paper.
Delicate Timing Considerations Also Affect When You File Your Bankruptcy Petition
You will want to be very deliberate
about when you choose to file your
bankruptcy petition.
If you file your bankruptcy too soon,
for instance, you may be losing the
opportunity to eliminate thousands of
dollars in tax debt.
The Timing Of Your Petition Forms A Central Component of Your Bankruptcy Strategy
Not only does timing affect your ability
to eliminate and manage tax debt, it
also affects what assets you get to
keep.
The bankruptcy code allows you to
keep certain amounts and kinds of
property. These allowances are called
“exemptions.”
Proper exemption planning can make
the difference of thousands of dollars
in your case.
Why Does My Tax Refund Matter?
Believe it or not, the bankruptcy
trustee can indeed take your
tax refund.
Without careful exemption planning,
you can lose your tax refund to
a trustee.
Here again, timing can be a critical
issue in eliminating and managing
tax debt.
When Is A Trustee Not A Trustee?
In addition to careful
planning and timing, you also
want to consider the unique
local circumstances of
your case.
A primary consideration in any
bankruptcy case is the identity of the
bankruptcy trustee assigned to
your case.
Unlike a regular trustee, a bankruptcy
trustee actually gets paid a
commission out of what they can
collect from you. Different trustees
take different approaches to cases.
Often, an experienced bankruptcy
professional can help you understand
how a trustee can affect your
bankruptcy strategy.
Can I File Bankruptcy Myself?
Yes. You can.
Keep in mind, though, that what a
lawyer is really selling is his
experience. He has navigated these
waters before. He knows where the
hidden pitfalls are located.
You can use your case as an
opportunity to learn the law, but rarely
does everything go right on the first
try at doing anything, let alone a
bankruptcy with its critical timing and
financial calculations.
Tax Debt: Manage It – Eliminate It
Tax debt is not invincible. You do have options. Whether it is eliminating
old debt or managing a large current lump sum, bankruptcy may be able to
help you.
© 2015 by Markowitz O'Donnell, LLP. All Rights Reserved. Design and editorial services by FindLaw, part of Thomson Reuters.
Learn more about how bankruptcy can help you manage
and even eliminate your tax debt by downloading our free
white paper, How To Eliminate Your Tax Debt:
Bankruptcy Solutions For Tax-Burdened Individuals. You
can also visit us online.
Share our white paper