Tax Liens

[brokenomore]

I had a payment plan to pay the IRS $4,000 in back taxes.

But after my 2009 return was filed, they cancelled my payment plan because I did not pay the taxes owed for 2009.

I owe around $800 on those taxes, and cannot afford to pay that now so that they can reinstate my payment plan.

Any suggestions what I can do?

They sent a "Notice of Intent to Levy" but I lost my home and have very little in the way of assets (all my assets are less than the exemptions allowed).

Can the IRS go after anything the other creditors cannot take?

What will they do if they have nothing to levy?

Has anyone had experience with getting the IRS to reduce or forgive part of the amount due?

[HHM]

As you found out, you default an installment agreement if you accrue new tax debt, it is automatic.

Generally, since the amount did not significantly alter the tax debt, you should be able to call the IRS and reinstate the plan and simply include 2009 debt in the reinstated installment agreement.

[brokenomore]

Am I correct that back taxes I owe on returns I filed more than two years ago can be dismissed in bankruptcy?

[HHM]

Read here

http://www.bkforum.com/showthread.php?t=24853

[brokenomore]

Thanks for the link. That pretty much affirms what I had learned online before I made my post.

However, I'm concerned about the issue of "fraud." In what situation would they challenge on that basis. I don't see that it would apply to me, but you mentioned that the law in this case is not as strict regarding proving fraud.

Lastly, if there are no assets, what does the IRS usually do? I don't put much in my checking account because I'm in a garnishment situation, but still use it regularly, and need my bank account for cashing checks. Would they shut my checking account down?