Can I file 13 after my C7 closes

[AngelinaCatHub]

I have been discharged and will close by February. I still owe IRS 30K. This is with interest and penalties piling up. Right now they threatened levy, and I put it into my CPA, so he says IRS does not know what to do. That is weird but so far I have heard nothing more from IRS or CPA.

If C13, I believe it will reduce the interest and in 60 months I can easily pay them off. Also will it give an automatic stay again to the Court Case my enemy is attempting to AP me on? 'Hub

[MJJ3767]

If you are eligible to file Chapter 13 on your taxes, why didn't you include them in the Chapter 7? The law is very strict on filing BK on taxes. I've just done it myself but I met all the requirements. Why not contact the IRS and make an offer of compromise?

Here is the deal with filing Chapter 13 on taxes or at least how my attorney handled it. More than likely the IRS has a federal tax lien on EVERYTHING you own......right down to your most intimate piece of clothing...lol.... So my attorney took the total cost of everything I own and that portion became secured debt which I had to repay in my Chapter 13. My total debt to the IRS was around $9000.....I will repay $4000.

I would look into an offer of compromise before filing Chapter 13.

[Nicollette]

I'm not 100% sure, but I'm thinking the time frame between a Ch 7 and Ch 13 is 4 years from the date of the Ch 7 filing.

Have you tried making any type of payment arrangements with the IRS? I know of someone that is going through the same situation you are with the IRS, and I believe she owes around $13,000. She called and made payment arrangements for $100 a month, and I guess they told her, as long as she sticks with the arrangements, she would be fine, meaning, they wouldn't levy her bank account.

[justbroke]

I'm not 100% sure, but I'm thinking the time frame between a Ch 7 and Ch 13 is 4 years from the date of the Ch 7 filing.

Have you tried making any type of payment arrangements with the IRS? I know of someone that is going through the same situation you are with the IRS, and I believe she owes around $13,000. She called and made payment arrangements for $100 a month, and I guess they told her, as long as she sticks with the arrangements, she would be fine, meaning, they wouldn't levy her bank account.

You can file a Chapter 13, you just don't get the discharge. So, that means that any debt included in the Chapter 13, needs to be paid in the Chapter 13 Plan... at 100%.

Please note, that there are other caveats, and this is effectively a Chapter 20.

Filing a Chapter 13 after a 7 may be good to get the IRS off your back... at least for 36 to 60 months.

[Nicollette]

You can file a Chapter 13, you just don't get the discharge. So, that means that any debt included in the Chapter 13, needs to be paid in the Chapter 13 Plan... at 100%.

Please note, that there are other caveats, and this is effectively a Chapter 20.

Filing a Chapter 13 after a 7 may be good to get the IRS off your back... at least for 36 to 60 months.

So a Ch 13 can be filed right after a Ch 7? I always thought there was a 4 year time frame between a 7 and 13, and an 8 year time frame between two 7's.

[rrockinggramma]

there is a 4 year time frame for a discharge however IRS debt is priority debt and would be paid back at 100 percent anyway. So discharge is not what he/she is seeking, only a way to keep the IRS at bay with no more interest fees and penalties being added. I say go for it!

[justbroke]

I believe that my District allows the Chapter 20. Different Districts, I read, feel differently about an interpretation of the Code. Especially post-BAPCPA of 2005.

You could even, effectively, save a home too! You have to very very careful and it has to be structured correctly and timed perfectly, however. Waiting until you have a sale date for your foreclosure (or even the summons) may make this very difficult... especially in Judicial Sales states.

[AngelinaCatHub]

there is a 4 year time frame for a discharge however IRS debt is priority debt and would be paid back at 100 percent anyway. So discharge is not what he/she is seeking, only a way to keep the IRS at bay with no more interest fees and penalties being added. I say go for it!

Exactly what I want. Yes Momma. Now will it also stay that damn AH that is suing, suing, suing, but nothing ever gets to Court. 'Hub

[justbroke]

Exactly what I want. Yes Momma. Now will it also stay that damn AH that is suing, suing, suing, but nothing ever gets to Court. 'Hub

Now that's an area of law I would ask my Law Clerk.

Your other Chapter 7 may need to be closed in order to do the Chapter 13. The AP would prevent the closing of the prior case, so...

[AngelinaCatHub]

Now that's an area of law I would ask my Law Clerk.

Your other Chapter 7 may need to be closed in order to do the Chapter 13. The AP would prevent the closing of the prior case, so...

[southernbelle]

I'm a little late reading this post and have a question. Hub, as you know my situation is very similar, but I owe much more in taxes. I understand that if I file a 13 after my 7 closes I can't get the discharge but was wondering how liens are handled. Liens have been filed for the total amount of the taxes owed, but in my chapter 7 claim it lists most of it as general unsecured. Since they filed the lien does that mean that I would have to pay priority and general unsecured at 100% in the 13 or just the priority? Is it even worth it since the liens will probably survive the BK?

Sorry if this is hijacking the thread, but due to the amount I owe the answer to the previous question could make the difference between me seeking to file the 13 or not. I'm still working on an OIC, but most people I talk to discourage me by telling me how few are actually accepted. I'm confused. Thanks again.

[justbroke]

I'm a little late reading this post and have a question. Hub, as you know my situation is very similar, but I owe much more in taxes. I understand that if I file a 13 after my 7 closes I can't get the discharge but was wondering how liens are handled. Liens have been filed for the total amount of the taxes owed, but in my chapter 7 claim it lists most of it as general unsecured. Since they filed the lien does that mean that I would have to pay priority and general unsecured at 100% in the 13 or just the priority? Is it even worth it since the liens will probably survive the BK?

First, liens are always dictated by underlying non-bankruptcy law... unless and until you get them avoided in Bankruptcy.

If you file a Chapter 13, within 4 years of a Chapter 7 discharge, then you can not, by law, receive a discharge from the Chapter 13. However, you can satisfy certain debts by paying them in full!

Perfect example, IRS tax debt. In every reading of how liens work, inside and outside bankruptcy, the lien no longer exists, once payment in full of the underlying debt is made.

Hence a Chapter 13 (within 4 years of a Chapter 7 discharge) can create a payment plan to pay back the IRS and to have the lien removed upon payment in full of the underlying debt. This is usually done within the Chapter 13 Plan duration (36 to 60 months), or whenever all the creditors are paid 100%.

It's my reading that you only pay the priority portion of the tax debt. The general unsecured portion (the penalties) are dischargeable. However, no discharge in the following Chapter 13, so my reading is that you'd have to pay that at 100% too.

Yes, the lien survives the Chapter 7.

[yellowstone]

you can delay a levy / garnishment of your wages by the IRS simply by requesting a due process hearing within 60 days of receiving their Notice of Intent to Levy. If they haven't given you that notice, you should look into a payment plan. You may also be eligible for an offer in compromise.

Assuming you have adequate funds to pay back the IRS over a 5 year period, they should be willing to accept a payment plan unless you have a history of default on previous IRS payment plans. It's also worth taking a look at how much you can afford to pay which is how an offer in compromise is based.

Affordability, for IRS purposes, means taking your income and subtracting the their standard living expenses. They'll expect you to pay the balance, which can be impossible if you have a large mortgage or rent payment, large car payment, etc... Their standard living expenses are quite low.

If you received the Notice of Intent to Levy and the 60 deadline has passed without your requesting a hearing, you can still request a payment plan although the collection officers don't have to stop trying to collect from you via garnishment. Typically it's worth trying to work something out with them. Be pro-active and take notes so you know what you agree to do. If you say "I'll submit a payment plan request by 12.20.08" be sure you do it. And don't wait until the last minute either as the forms are detailed, confusing, and you'll probably want to post questions and wait for responses as you fill them out.

[Flamingo]

I didn't have a chance to read all of the other responses on here but can't you investigate an "Offer of Compromise" with the IRS since you were/are insolvent and are in BK? I see all sorts of ads on the TV tauting "Settle with the IRS for pennies on the dollar" - of course there are attorney come on ads but anything is worth checking out to see what can be done in your situation...

[southernbelle]

Thank you guys. This really helps. I searched a site that specializes in providing information on Enrolled Agents and found one near my home. Actually the site gave about 7 or 8 in my area but only one responded to my email asking if they handled OIC's. He charges $150 an hour so I think I'll spend this weekend preparing for a consultation with him next week so that he can give me guidance on my specific situation. Thanks again.