Best Way To Find BK Laywer For high Debt, Old Businesses Involved, And Tax Discharge?

[NSH]

Okay, for years the people in this forum have admonished me on the rare occasion I have posted that I need to get off my ass and declare BK. I finally have to do it. There really is no plan B. The debts I want to discharge are so old (most from 2007 and before) and there are taxes and old no longer used businesses involved. In fact, they are so old, that so far, over $100K have literally been FORGIVEN (Bank Of America, and Chase). This is one of the reasons I was waiting, because WAY back in 2008, Bank Of America sent me a notice for about $75K that was written off and forgiven. Chase recently sent me a similar notice, but I forget for about how much, over $50K, though. lol I was planning on just waiting it out, to be honest. I also heard that after ten years, any money owed the IRS is wiped clean, as long as there was no fraud. But I don't even know if that's true! The bulk of my owed taxes are from years 2005 (filed in late '06) and before. So I was kind of hoping to wait them out too! However, this waiting crap is (as most of you predicted when you rightfully ganged up on me) getting really old!

Another reason for waiting is because I also owe about $250K in non-dischargeable Student loans, so I have been honestly feeling like, "Why bother??" Whats the point? I declare BK and still have a quarter of a million dollars over my head (note: it started out as about $90K after graduation, but years of deferment and forbearance take their interest tolls!). While it's no excuse, the reason for not bothering to declare is I make so little money and have no assets they can't bother me, even the IRS or NY State. But honestly, with the student loans, the insane taxes, all the debt, I wasn't so much hiding my head in the sand (though I was doing that too) as much as I have been so overwhelmed, it seemed pointless. I mean, so I discharge over $100K in Federal taxes and about a quarter of that in State? So I discharge all credit card debt? So I discharge all loans?? Big deal! I still have an uncrackable $250K nut over my head in student loans! lol I know, no excuse, but sometimes being overwhelmed does screwy things to your head.

Anyway, how do I find a lawyer? How do I know what I should be paying? I have to do this now. I need to take some kind of charge of my life. I am 49 years old, I now have a decent job, and I just want to do what I can, even if it means I am stuck with a $250K nut that I will mostly take to my grave.

Anyway, any suggestions on finding a lawyer savvy with tax debt and what I should be paying?

[AngelinaCat]

Call the clerk of the BK Court in your district and ask for a list of attorneys. They are not allowed to recommend any one person over another, but you should get several names.

The clerks in the Courthouse deal with the attorneys every day, and the chances are that the list you get, will be the ones that they, the clerks, prefer to deal with. These will be the attorneys that are professional, organized, on time, and have a minimum of mistakes or omissions that have to be amended. This should help weed out the ones who are careless about their work, rude to the clerks, running late, etc.

Good luck with your search.

[NSH]

@AngelinaCat, thank you!

Here is another question, unrelated and related at the same time. It is timely to the thread I created this afternoon actually. I just got home (late day!) and sitting in my mailbox was an oh so lovely letter from the NY State Taxation & Finance. Apparently they are giving me SIXTY days to respond and pay them or they are going to suspend my driver's license. Does anyone here live in NY State and owe back taxes? Because just a few minutes ago, I Googled it, and apparently this is a big thing to collect back State taxes from...ya know, scofflaws like me!

I have to contact them within 60 days, but if I get BK going before then, can my BK lawyer deal with this sh*t??? I am pretty sure state taxes are dischargeable in BK. The only years they are slamming me for are 2005 ($24K with interest and penalties) as well as sales tax on a defunct business (08 and 09) though I think I can get out of the sales tax because I never filed my sales tax after closing the business. I owe sales tax returns for like half of 07 and the first quarter of 08, (closed the store in June 08) so I am contacting my accountant to file the back returns and officially "close" the business, but the bulk of the debt is for '05 income. They haven't sent me a threatening letter for 06 through the present, though I made only about 20 to 25K per year those years, so the money owed will be lots less.

Yes I am a degenerate.

[NSH]

Another couple of pre-lawyer questions:

1. I am afraid I may fail the means test because my gross income is about $10K over the median. However, I have a lot of expenses, and since my income is all 1099 based, I can legally declare 1/3 of my home rent, utilities, etc. I also have professional insurance (about $100.00/month) Continuing Education requirements for my license, lincesing fees, accountant fees, transportation, and a bunch of other stuff most people have. Is it dubiously legal for me to start buying good health insurance to get my net income down or to help with the means test? I ask because I am pretty sure that you can declare health insurance on your income tax if you are a 1099 who has their own business entity name that they get paid through. Still, I can easily pay about $10K in health insurance per year, well maybe less, way about $7.5K per year.

2. If you end up with a little extra cash before filing, is it considered unethical to pre-pay utilities, health insurance, and residence rent? lol I am talking about reasonable amounts here, like a couple of thousand dollars or something NOT trying to get rid of like a hundred grand!

3. Many BK lawyers believe that you can't discharge income or state taxes. I assume I should politely thank these folks for their time and leave as soon as possible to go to another lawyer?

4. What should I expect to pay for a good BK lawyer, when this an are old, defunct business I lost a ton of money in (I opened a store back in 2006 that closed in 2008) and there is a lot of money in back taxes from 2009 and back?

Thanks again, you guys are the best!

[kornellred]

Any attorney who "believes" that one tax or another cannot be discharged in bankruptcy is admitting to not being up to date on bankruptcy law. Federal and state taxes can be discharged under certain specific circumstances. It would be hard for me to believe that a potential client who consulted with a bankruptcy attorney could leave the consultation without being relatively certain of their situation with respect to back taxes.

Attorneys cannot charge whatever they like for bankruptcy filings under Chapter 7 or 13. The limits are prescribed by law. But, that is for the basic procedures involved in filing. There are often many unrelated matters that need attention before filing can be accomplished. With all of the digging into the past that will be required to substantiate old tax debts, the OP's total legal fees will be rather high. Competent attorneys in regions of the country where per capita income is relatively high will tend to value their time starting at $300 per hour or more. A bankruptcy client will typically be quoted a total fee prior to filing for services which are necessary in order for filing to occur. Along with the proposed fee, the attorney will caution the client that there might be issues that will need attention after filing, such as motions by the trustee, that will incur further fees. Legal representation is expensive, to say the least. But, worth it in most cases.