Need help again everyone! Cindy or someone please!

[MajorMike]

We owed taxes for the first four years after filing. The first year was large ($1500) after filing and we contacted our attorney since in years before we itemized but just did not have enough deductions to do that, had to use the standard deduction and were too emotionally distraught to redo our exemptions. After that we fixed the situation and the remaining years were small amounts owed (under $200 between state and federal). Last year we got our first refund due to our daughter's college (Hope Credit). We were told the taxes owed after filing are our responsibility and to call the IRS and work out a payment plan that will work with us as to our Chapter 13. We paid $50 a month for several years to the IRS outside of our Plan on the $1500 debt. Debts and tax bills after filing are not part of your Chapter 13 filing. They are new debts and your responsnibility. If they create a struggle or additional hardship, contact your attorney for further instructions.

Thanks Flamingo!
The thing is, I believe every district may handle this differently.
Can they just amend their complaint and add in the new amount and increase my plan payment?

[helpless]

The IRS magically found that we owed them $2k (it was from that darn tax rebate) from 2003 after we filed in 2005. Imagine our surprise. We had already filed and received tax refunds in 2004 and 2005, so I have no doubt filing bk had something to do with it. This all happened after we were confirmed. We were able to add IRS into the plan, but I think that that was because we didn't take anything away from unsecured, just added time to the plan. At the time it was a 37 month plan, but turned into a 40 month, I don't know if you will be able to do that since yours is so close to a 5 year plan. Also, were were old law. Just wanted to say Good Luck and I know your pain.

[MajorMike]

We're in a 57 mo. plan ( it actually says 4.9 years on the paperwork) so I'm wondering if they can make it 60 months which would add on 2400 or so and then the remainder, we can increase our payment for. I'll get a part time job or something ...
Ugggh, I need a new life!

[mcdulph]

On another board, someone had a similar situation. The attorney on that board said that if you incurred the debt to the IRS *BEFORE* you filed BK, money that you owe to the IRS can be included in the Chapter 13.

In other words, even though you didn't KNOW about the IRS's claim against you until after you filed...you actually owed the taxes on that filing date. So it's really not new debt that would be held until after the Chapter 13.

So my guess (and of course, I'm not a lawyer, yada yada...) is that your unsecured creditors might wind up getting less because the IRS debt is priority. This is assuming that you are already paying the maximum amount that the law says you have to.

Good luck...I feel your pain. We also got a nasty little surprise from IRS b/c hubby failed to tell me he had raided his Roth IRA a couple of years ago.

[Flamingo]

Thanks Flamingo!
The thing is, I believe every district may handle this differently.
Can they just amend their complaint and add in the new amount and increase my plan payment?

Just remember first it is not the end of the world. You and your wife have not just been diagnosed with terminal cancer and things are not as bad as you think - you will get this worked out. Secondly, you can ask your attorney if your Plan can be modified to include the IRS amount. I don't know how much longer you have in your Plan but a lot will depend on what you are paying now, what you will be able to pay and if the modification can actually be done. In any event, you will owe the taxes. I don't know if there is anything as to a hardship issue you can utilize here but you will need to review this entire thing with your attorney because that is a large sum to include to modify your Plan and spread out over the remaining course of the Plan. I believe you can pay the IRS back in a 5 year period but you cannot have two payment plans with them. Consult your attorney and get the answers you need; best of luck to you and try to relax. You will get this resolved!

[buchanj]

Doesnt it seem that we look back at things we were worried about and we wonder why we worried over it in the first place. Itll sort out mike.

[MajorMike]

You guys are so great! I bet you think I'm a big loser with all this mess eh?
I'm not sure how much we'll end up owing but I'm thinking inthe 5K range. Our income fluctuates so much because we're commission that that's another thing that sucks.
One year, we could make $50k, the next $80K.....we never know.
I want to say let's pay $100/more a month into the plan to get them paid off but then again, I could have a bad year next year or even THIS year. Who knows?
I wish I would have made better financial decisions in my life. I know it's not cancer, and I AM grateful for that, but the stress I've been under sure feels like hell.

[Flamingo]

You guys are so great! I bet you think I'm a big loser with all this mess eh?
I'm not sure how much we'll end up owing but I'm thinking inthe 5K range. Our income fluctuates so much because we're commission that that's another thing that sucks.
One year, we could make $50k, the next $80K.....we never know.
I want to say let's pay $100/more a month into the plan to get them paid off but then again, I could have a bad year next year or even THIS year. Who knows?
I wish I would have made better financial decisions in my life. I know it's not cancer, and I AM grateful for that, but the stress I've been under sure feels like hell.

Loser? Heck no! .... Someone having one of those dreaded bad life events? Yes!

[MajorMike]

Thank you Flamingo ;)

[MajorMike]

Hey Flamingo, Im only 4 months into my BK so if I pay another $125 /mo for the next 46 months, we should be ok. The IRS can't accrue interest while we're paying them can they? also, they get paid first if it is priority so it would get paid off sooner ?
This is so confusing! LOL

[Flamingo]

Hey Flamingo, Im only 4 months into my BK so if I pay another $125 /mo for the next 46 months, we should be ok. The IRS can't accrue interest while we're paying them can they? also, they get paid first if it is priority so it would get paid off sooner ?
This is so confusing! LOL

You need to discuss this with your attorney before you proceed any further. That is a lot to pay an additional debt on the side outside of your Plan. You may have two options; modifying your Plan or working out a payment plan with the IRS for that amount over that period of time since you are in a Chapter 13 and paying it outside of the Plan. You really have no other options inasmuch as you owe the taxes and short of being in absolute poverty and on the street, there is no way out of paying them. You will just have your hands a bit full for the next 4 - 5 years until you start to get out of the hole. Just lay low in the interim, pay everything on time and believe me, there is a big bright light at the end of the long dark tunnel. You may think not at this point in time; but there is....

[car67]

Mike I am sure you can add the taxes to your current 13 as priority debt. I would have your attorney file the amendment dont panic too quick I am alot like you I panick too in fact just got notice from state I owe them $1600 for 2004 in personal tax....... All we can do is work and pay what we can.... What are they going to do? As long as your paying is the maint hing then we are here to make more money the next day....

[mcdulph]

BTW, if you DO find the paperwork that will support your deductions, I've had good luck getting those IRS bills to go away. In two different years, my hubby failed to give me some paperwork to plug in to TaxCut, so we got a nice notice from the IRS a couple of years later. It wasn't that we really owed more money, it was just that our failure to file the right forms caused the IRS computer to barf on our return.

In both cases, we were able to write letters and/or file an amended return to fix the paperwork screwup, and we got a nice "closing letter" from the IRS saying that we didn't owe the tax after all. It did take a couple of tries to clear up the confusion with the examiner who was handling the case, but it was well worth it.

And I just thought of this--is there any chance that bank or credit card statements would back you up regarding your deductions? You might be able to request that stuff online or via a call to customer service, if you can't lay your hands on the paper copies.

Good luck!

[MajorMike]

Thanks again everyone.
The problem is not with the expenses persay. I think I only had about $600 in entertainment and dining stuff. It was the gas for the car. We're allowed 48 cents for each mile and that year I put about 30K miles on the car for business which is about $15,000 in deductions. They want proof I did that but the car was sold 2 years ago, and the employer I was with was bought out. I'll try to explain that to the examiner but I doubt they will care one way or the other. No receipts or proof----pay the piper.

[biotechsolution]

unfortunately you can pay interest in a chapter 13, just not the penalties.