"The Sherrif is coming to serve you papers..."

[HHM]

No one ever came out ahead by burying their head in the sand. All I read is someone making excuses not to file and sort of living with self-pity (not healthy).

[NSH]

Well that was completely un-helpful, crass, and ignorant, HHM, thanks for the entertaining insight into your intolerance. I am going to restrain myself from personal attack here because while your "statement" was completely ignorant, I do believe that you are trying to help even though you are the only one who posted who actually didn't. Thanks anyway.

Please don't assume this. "I've been a tax preparer" is not the same as "I am a tax professional". Also, I've known a lot of "professionals" who are ignorant about tax law. For example, one person I know has been preparing taxes for over 30 years. I have the utmost respect for him as a person. His clients absolutely love him and send him their taxes from all over the world... they won't use anyone else. I happen to know for a fact that he doesn't believe debt that is discharged in BK is forgivable income. One of his clients filed BK and based on the 1099's that he received for the discharged debt, this professional let him know that he owed the IRS over $100,000. !!!! That's a BIG MISTAKE! But his clients have so much confidence in him that they never question if he is right or not. So again, don't assume I know all about this. Just because I've never heard of it doesn't make it untrue.

BTW... what I said about tax professionals is true of other professionals as well. We spoke to several attorneys who would have steered us in the wrong direction with our BK before we finally found someone with enough knowledge to help us. You should too. It really sounds like you could file a 7 and be done with this. Chin up.... you're not as far from freedom as you think you are.

Good points. I will definitely keep all this in mind. I have been researching this and will move forward when I have the money to and feel comfortable enough about not being audited too far back. In addition, another benefit of waiting I am reaping is that my income taxes for 06, 07, and 08 are now dischargeable, which will definitely help since in 2006 I made a decent amount but since I filed all three of those years in 2009 (or 10, I have to look) the "2 year rule" regarding income tax will hopefully come into play. I also made a HUGE mistake in accounting in 2006 (which lol my accountant chastised me for) I invested a bunch of my own income from one profession into my business that would fail, but I FAILED to file the proper S-Corp paperwork! This means that instead of the income I invested in 06 and 07 (and lost in the business!) being a write-off, which they would have been had I filed the proper S-Corp papers, both the IRS and NY State rejected the write-offs. This would have been more of a burden, so that is one reason (one of many) why waiting was necessary to this point at the very least.

Now pretty much the only thing I am waiting for is the funds to actually move forward. The cost of BK is considerable, or at least it was when I was looking into this. I believe that for a case like mine, $5K to $7K is about what I will need to pay, which is, quite honestly $5K to $7K that I don't have. But lol I am saving.

[frogger]

Well that was completely un-helpful, crass, and ignorant, HHM, thanks for the entertaining insight into your intolerance. I am going to restrain myself from personal attack here because while your "statement" was completely ignorant, I do believe that you are trying to help even though you are the only one who posted who actually didn't. )

No, the post from HHM was not any of what you stated. The post from HHM was blunt, to the point, and without any sugar coating on it. HHM's reply was actually very good advice.

[NSH]

No, the post from HHM was not any of what you stated.

I completely disagree, but then we all have our opinions. Since I see where his head is at, which is fine since he has his opinion too, I will just focus on the other advice given me thus far which I actually do find helpful.

[HHM]

Okay, let me try another way.

You are spending all this time and effort trying to figure out how not to file BK, when in reality, you KNOW, and everyone else her knows that is what you SHOULD do. Seems like a waste. You are playing, what I call, the "what if" game. In the extreme, the what if games results in "what if the world ended tomorrow, then I wouldn't need to file BK."

It is basic analysis paralysis. You're spending all this time trying to "research" when what you should be doing is getting down to a good attorney's office and getting a plan together. But that is not what you are doing....hence, head in the sand, finding excuses not to file, etc etc.

I am just trying to provide some "perspective".

[Pandora]

HHM reminds me of the TV commercial where the M&M rips his candy shell off, dancing away to LMFAO - no sugar coating

His advice, while blunt and straight forward - is dead on. Sometimes its hard for people to hear / see the truth when its put before them by others, and their defenses go up.

I think he called it correctly.

[NSH]

I disagree, Pandora. But I won't argue with you about it. I will state my POSITION one final time.

Okay, let me try another way.

You are spending all this time and effort trying to figure out how not to file BK, when in reality, you KNOW, and everyone else her knows that is what you SHOULD do. Seems like a waste.

It is basic analysis paralysis. Your spending all this time trying to "research" when what you should be doing is getting down to a good attorney's office and getting a plan together. But that is not what you are doing....hence, head in the sand, finding excuses not to file, etc etc.

1. Actually, I have had some very good reasons not to file until now, not the least of which includes NOT making enough money to save the BK fees, which in my case will be much more sizable than your standard cookie-cutter $1.5K BK! Everyone has already told me this and I simply CANNOT afford to pay that kind of money yet.

2. I am NOT feeling sorry for myself or sticking my head in the sand. I know FULL WELL the implications of this decisions and precisely what the benefits and consequences are to putting it off, and I am CHOOSING to get more information, because there may actually be a chance (though a remote one) that much of the debt I have will disappear with time OR that my creditors including the IRS will take pennies on the dollar. True story: About $100K of my huge business debts were forgiven by Bank Of America! That includes a couple of CC's, loans, and lines of credit! BOA basically wrote off my whole debt to them! Who else will do that and who else might I be able to really chisel down? One thing I know is the longer I wait, the longer these credit card companies have to realize that they aren't getting SQUAT from me. In addition, at least TWO LAWYERS told me that after 9 or 10 years (I forget) as long as you filed, your taxes disappear. Now, while I know NOTHING about this, and a tax preparer in this forum states that isn't true (which maybe it isn't, I don't know) it is worth researching.

3. Since I kept such HORRIBLE records, even though I made no money from my failed business, I DO NOT want to be audited for those years by the IRS, if it is at all possible. So the longer I wait (hopefully) the more "other years" they will have to audit me for and not the ones while I was in business.

Now you guys can be nasty to me all you like. Hell, I even get it. This is your sort of Internet version of "tough love" which you believe is for my own benefit. Kind of like hazing the new guy in an anger management class to get him to lose his temper and realize he has a problem he isn't seeing. I get it. You think I am not aware, hiding from the truth, or feeling sorry for myself.

I'm not. So if you guys want to gang up on me and make categorical assumptions, (shrug) that's fine. I am not going to lose any sleep over getting "ganged up" on in a forum and everyone taking the moderator's side. Hell, you can even ban me from the forum if you like. But I have delineated my situation clearly, and I firmly believe that this is the right course for me, and YES, the questions I asked I wanted answer to, which, thanks to a few very helpful members, I received.

So I am WELL AWARE of the dangers and benefits to what I am doing, and your "tough love" approach is not going to convince me of anything. I am, however, open to TALKING about this and discussing it, as well as LEARNING from you. But I have taken enough SHIT from my creditors and from my situation, that I can choose to ignore comments that I think are snippy or a little insulting, yes, even if your intent is not to be insulting. SO I now feel I have fully explained my position and I have no need to argue further.

So thank you for all your help, everyone, and I definitely want to continue talking about this, but I DO NOT want to argue. Seriously, we don't have to be Internet tough guys. Let's try to be nice. That's all I am asking.


Edit: Look, if I seem NOT receptive to any negative energy, I apologize, BUT at the same time, I am not, at least not about this topic and not at this time in my life. You want to argue tech, music, videogames, athiesm Vs theism, creation Vs Evolution? Fine. Then I am prepared to have a heated debate and deal with any perception of "tough love" you may have. But ask yourself this: If I am not going to be receptive to a certain tone or attitude, which I think I have made clear, then is it really that important for you to "win an forum fight" with me? I am not here to fight and argue, and about this, which is far more personal to me than some of you might be prepared to tolerate, and that is fine. But if you see that a certain approach is causing me to shut down and be defensive, then right or wrong, why not lose that attitude? That's what I would do if I were trying to help someone and not just "win."

[walkthaplank]

You have been given good advice here. Nobody can make you take it. Being told that you are hiding your head in the sand is not "negative energy", in this case it is just a statement of fact. We were all in denial at one point, some of us were pretty good at it. You don't want to know how many years I kept bouncing debt around thinking that I'll be able to fix it. I couldn't.

You need to find a way to come up with the money to file, otherwise you are going to continue living your life this way. As long as you committed no fraud and have not committed any crime you aren't going to have any issues. The fact that you are bad at bookkeeping means that you probably shouldn't be in business for yourself, that doesn't make things worse when you file. The only way you are going to come out on the other side of this problem is to do something about it. Some of your tax debt will be dischargeable, some won't. But the first step is dealing with what you CAN deal with, then work out arrangements on the rest of it.

Your problems are only going to get larger, they aren't going to spontaneously fix themselves.

[bcohen]

I have heard that the IRS has a statute of limitations of 10 years--from the filing date--to collect taxes assuming that the return was filed, and allegations of fraud are NOT being raised. However, this will not protect you from being audited if the IRS believes that you concealed income, etc. In any case, even assuming that the tax returns are accepted at face value, and no auditing is planned, 10 years--from the date which you filed the returns--is a long time to wait. Filing for bankruptcy is still your best option.

As a side note, I live in a much lower cost-of-living state than you do, and these "$1500 cookie-cutter bankruptcies" that you speak of do not exist. Typical attorney fees ranged from $2000 to $3500 to file a basic Chapter 7, which is why I did not file (not worth paying that much to discharge what was at the time less than $30k in debt) and when I do file, I probably will do it myself. The bankruptcy you need will likely cost upwards of $8k, and from the sound of it, will be worth every penny. You need a very skilled and experienced attorney in order to file successfully; a normal person seeking to discharge credit cards, car repo debt, and other unsecured consumer debt does not.

[LadyInTheRed]

Now pretty much the only thing I am waiting for is the funds to actually move forward. The cost of BK is considerable, or at least it was when I was looking into this. I believe that for a case like mine, $5K to $7K is about what I will need to pay, which is, quite honestly $5K to $7K that I don't have. But lol I am saving.

How long has been since you consulted with a BK attorney? It sounds like your business debt and much of the IRS debt has become quite old. I really doubt the US Trustee is going to be up your ass because of businesses that closed in 1998 and 2006. After the passage of time, your BK may not be as complicated as it once was. If you haven't consulted with a BK attorney recently, you should.

"Head in the sand" was the exact phrase that came to my mind when I first read your post, long before HHM responded. Debt problems since 2007 and still no plan to deal with them. Hoping old debt, including tax debt, will just go away even though you still are not filing your tax returns. Nobody is gaining up on you. They are just telling you how they see it according to the information you provide. For somebody who says they don't want to fight and argue, you are doing a lot of arguing. Why not just ignore the advice you don't agree with?

[NSH]

The bankruptcy you need will likely cost upwards of $8k, and from the sound of it, will be worth every penny. You need a very skilled and experienced attorney in order to file successfully; a normal person seeking to discharge credit cards, car repo debt, and other unsecured consumer debt does not.

Which is precisely one of the main reasons I am in no rush to file. Because my chances of putting my hands on 8 grand ANY TIME in the near future are quite honestly slim and none. While I thought the cost would be between $5K and $7K, the fact is that $8K is just as unattainable for me at this time in my life as is $5K. Honestly, I will file my last three years and get current on my taxes this fall, because we are talking about a very small sum of money...hell, I can even do it myself my income is so low in 09, 10, and 11. But this is not a matter of hiding my head in the sand as some are suggesting. It is a matter of NOT being able to come up with the cash to properly handle this issue COMBINED with the fact that as the debt gets older and older it seems to be that it will also get easier to discharge WHEN I am finally able to do it.

Yes, there is a component of "wait and see" happening here, as I alluded to, but it is not the main reason I am not filing BK. You cannot get blood from a stone to pay your creditors, and the same applies to any attempt to get a whopping 8 grand together. In short, with NO assets at all under my name, no bank accounts, and nothing they can take, you want to know what else? While I admit this sucks, there is also a component of, "So bring it then!!" that I am sort of silently saying to all my creditors, including State, Federal, banks, and CC companies...oh and let's NOT forget a huge Student Loan that is not able to be discharged. The second I go bankrupt then I have over $200K (with all the interest built up over years and years) to contend with!

So here is my position: I get rid of everything that can be discharged and I am still in a HUGE hole, only this one cannot be dug out of! Maybe this makes no sense to you guys, and if so, I respect that. But honestly? With the Student Loan debt looming just as large as anything else, the weird thing is that I am not so much sticking my head into the sand as I am throwing my arms up and facing EVERYONE I owe money to and saying (again silently) I HAVE NO MONEY! Even if I get rid of some of you, it really changes my life VERY LITTLE! So...um why bother?

Does this mean I won't file BK? No. But anyone who thinks my head is "in the sand" is sorely mistaken. It is out and getting pummeled by the light of unabashed, oppressive reality. Because I am having some trouble seeing the benefit of spending $8K on BK even if I was able to put my hands on that kind of cash! Better to spend it on...oh food, rent, clothing, etc.

Again, I get you folks don't understand my position. But I am living it, not running from it. I am just having trouble envisioning what BK does for me other than takes my $200K Student Loan from the back burner of unable to be paid and puts it on the forefront of unable to be paid!

[Drazil65]

Hi, sounds like you need a better job or 2 to start generating some money. Your student loan debt is large so does that mean you are a professional student or a doctor perhaps? With all of your education seem like you would have a fantastic job but you state no money? You have put yourself in quite a hole and we see that you recognize that (no sand hiding) but it comes across like you are trying to do a quick fix with very little thought of how you got there and what will keep you from getting there again. You have to start somewhere and it sure sounds like you are not making anything on your own in business so its a good time to give up the ghost and start working a 9 to 5 if that is what you need to do.

Truthfully if the jobs are not where you are then move. Many of us have had to do it and leave alot behind. Bankruptcy is not just about getting rid of the debt but its a mindset to live a different lifestyle/way in the future. These are the consequenses of your decisions, plain and simple, alot of student loans mean alot of payback. Not filing your taxes on a yearly basis means dealing with tax debt and the federal government at some point. You really need to sit down and start somewhere with getting things in order and not just throw your hands up and say screw it I cannot pay so thats it so whatever. We understand you are frustrated but this will not fix itself. We really wish you luck and hope you can figure out something to get yourself moving forward. Good Luck.

[Pandora]

I disagree, Pandora. But I won't argue with you about it. I will state my POSITION one final time.

Now you guys can be nasty to me all you like. So if you guys want to gang up on me and make categorical assumptions, (shrug) that's fine. I am not going to lose any sleep over getting "ganged up" on in a forum and everyone taking the moderator's side. [/COLOR][/B]

I'm not arguing the issue (not the arguing type) - just looking at the glass from a different point of view - and - I dont tend to "agree" with someone because they're a mod, lawyer, President, movie star or anything of the sort. I tend to agree when the advice is spot on and for no other reason.

No one is ganging up on you, I've not read that in any of the posts thus far; I've only read others opinions who have "been there and done that" to an issue you fully posted concern about on a public BK forum - no more, no less.

[NSH]

Drazil65, these are all issues I am going to have to think about long and hard. Unfortunately, it isn't as simple for me as getting a 9 to 5, for instance, but that is another whole conversation and a can of worms I don't even want to begin opening here. Suffice it to say you make some very good points.

Pandora I was not suggesting you were arguing. I was saying that I didn't want to argue. Meaning that I am not going to come to a forum, ask advice, then argue with people about what I don't agree with. There was only one person whose "tone" I somewhat objected to, and after stating my position and restating it in some frustration, I wanted to make it clear that I was not going to go round and round about it. The bottom line is I respect the advice given, even if some things don't apply to me and some do. It would be impossible for the folks in this forum to know my exact situation anymore than, say a mechanic can diagnose your car on a fuurm because you "described the noise" your engine was making in great detail. The same would be true if this were a medical forum and I were to waltz in here and give a list of symptoms. Even meticulously delineated, it would be difficult for a diagnosis from people who knew medicine, say, but were not even doctors. Not that a doctor should be doling out online diagnosis' either lol.

[davetedge]

NSH,
I understand bit of where you're coming from. I also have a lot of debt from owning a business and have been holding off on filing BK for going on 2 years now. I'd like to think I have good justifications for holding off (need to file business tax returns, receive personal tax refunds, spend down my cash), but I also know that's 2 years that I haven't been able to put a BK behind me and get on with my life.

And so it goes. The more practical issues you have to deal with in your judgement-proof state is knowing exactly what the NYC Sheriffs and Marshals can and can't do to you.

The NYC Sheriffs are City employees and NYC Marshals are independent contractors (both follow NYC and NY state laws). They both spend a lot of time towing vehicles and the Sheriffs are the ones that perform evictions. They can also levy bank accounts and garnish payroll (W2). Finally, they have the power to seize personal property and auction it off, but the creditor must pay the Sheriff's or Marshal's costs in advance, so this usually doesn't happen unless it's absolutely worth it.

The other thing to keep in mind is NY has something called the Exempt Income Protection Act (EIPA) which protects debtors from getting completely wiped out. This means that the first $1,740 in your bank account is untouchable ($2,625 if you get social security or unemployment or some other exempt benefits). Furniture, personal items, and up to $1,000 in cash and $3,000 in tools of the trade are also exempt. And if you do own a car, as long as the equity is less than $4,000 they won't repo it.

I think the most important advice I can give is this: track your creditors. Know which ones have sued and gotten judgement against you. Those are the ones that can move quickly to get your stuff. Both Marshals and Sheriffs can be very intimidating in person (they have carry permits), but they're bound by EIPA.

Of course, when you do finally file BK, you'll be able to stop worrying about all these details. I feel you on the tax and student loan debts. I hope you can find a way to start tackling them head on, not just running out the clock.