Do you have to tell HR Block

[dmc-2008]

Or any other service that you filed for a 13? I dont owe taxes or anything like that but do they need to know?
Thank you!

[LadyInTheRed]

Why wouldn't you tell your tax preparer that you filed BK? If I didn't do my own taxes, I would want my tax preparer to understand everything about my financial situation. If you aren't comfortable telling somebody you filed BK, why would you be comfortable with them preparing your tax returns?

That said, the only reason I could think that your tax preparer would need to know about your BK is if you receive a 1099C on discharged debt or you stripped or crammed down a loan secured by an asset for which you claim a depreciation deduction. But, there may be other reasons they would need to know.

[lillymarlene]

I told my preparer who I have known and used for over 20 years. My chapter 13 was considered to be a "business bankruptcy." I also figured my accountant would wonder why I suddenly had $4,000 in legal fees in my business expenses, when I never before had anything like that. lol

[dmc-2008]

Thank you for your response. I would not want to tell them that personal info because we know a lot of the same people and it is personal. However I have no problem telling a professional that I don't know. I usually do my own as well but thought a pro can help me figure out how to get a zero refund so I dont have to give it to trustee. Pls remember I am new at this and just trying to figure it all out!

[dmc-2008]

I am not sure what a 1099c is. I am discharging some unsecured as well as lien stip, but not sure what a cram down is. So much to know

[TheBajan]

A 1099c is a document that your creditors will send you when there is forgiven debt (or debt discharged in a BK). Let's say you borrowed $25K from a credit card company and paid back $2K. You still owed $23K when you filed BK so the credit card company sends you a 1099c for the $23K. Under normal circumstances, that forgiven debt would be considered taxable income and you would be required to report it and pay taxes on it. However, all debt discharged in a BK is non-taxable so all you would have to do is report to the IRS that it is exempt from income tax under title 11 BK. You only need to do this IF A CREDITOR sends you a 1099c. They are not required to send one to you so it's a wait and see game.

[dmc-2008]

Thank you, I had no idea about that.

[Mayo]

No you don't have to tell them. I got a quote from HR Block one year for a tax prep and it was around $400. I found a tax and payroll person that does mine for a flat $75. He's great and I could probably do my own but 1 hour and his price is well worth not having to deal with the headache. I did ask him one time if Lawyer bills were considered deductions and he said no, but that was all that was ever mentioned of my 13.

[ValleYum]

I usually do my own as well but thought a pro can help me figure out how to get a zero refund so I dont have to give it to trustee. Pls remember I am new at this and just trying to figure it all out!

Just a comment: Getting a zero dollar tax refund is more the result of careful pre-planning and withholding the proper amounts from your paycheck rather than simply having your taxes prepared. There are some free calculators available online that may help you with this endeavor.

[dmc-2008]

Thank you Valle Yum, your right. I have been tweaking my deductions but it is hard to know what tax write offs will do. I hate doing them myself. But it sure is the cheapest route!