Question about Ch. 13 and Trust Fund Taxes

[southernbelle]

I am dealing with the IRS with a repayment plan for Trust Fund Taxes and I am curious. In a Ch13, are back taxes (local and federal), associated penalties and interest frozen and basically lumped into the Ch. 13 plan or is some part of Trust Fund taxes that can't be included in the plan? Does filing Ch. 13 keep the IRS from filing tax levys or liens against you?

I'm curious because I've been reading various links about the IRS and it seems as if they will allow a repayment plan, but might impose a lien on anything of value for assurance and the IRS lien will end up on my credit report which will make it very hard to reestablish credit until they are paid back 100%. The IRS is the only entity left to contend with that will not be absolved in a Ch. 7 and I am weighing all of my options. Thank you in advance.

[rrockinggramma]

the answer is yes to your chapter 13 inquiry. It does freeze the IRS while you pay them back. However, because you just received your chapter 7 discharge, you have to wait to file a chapter 13, I think it is 2 years? The chapter 20 was taken away by Congress in 05.

[southernbelle]

I'm sorry, I wasn't clear. I haven't filed BK yet. I qualify for Ch. 7 due to more than 50% non consumer debt and was trying to decide if I should file a 7 or 13. I was all set to file the 7 in Feb 08, but I am still dealing with the IRS. I am sending the returns they need to calculate the damage this week, so I don't know how much I will owe with penalties and interest. I want to set up a payment plan directly with them, but have heard that they could place a lien on my property anyway. I was thinking that if I am able to repay all of the non-dischargable debts within 3-5 years on my own, I will stay with the 7, but if the IRS says I owe some huge figure a 13 might be the way to go if this type tax can be included in a 13.

If TFT can't be included, I'll consider selling my house. About 2 months ago, I didn't foresee a problem because I was able to establish a reasonable plan with the local taxing authorities with no problems. In reading what the IRS will and can do is frightening. I just don't want to get stuck with an IRS lien on my credit report I can't get off or have them place liens on anything they feel like. Does anyone here have an IRS lien? I hear it makes you untouchable creditwise until they are paid back in full.

I guess I wanted to find out the worse case scenario and if they decided to get "agressive" with me for TFT repayment, what my options would be. I would hate to go with a 13, but just wanted to know if anyone here knew if IRS TFT payments could be included in the 13. Thanks again.

[Granny]

SB,

I replied to your questions in the other post.

Granny

[ruggal]

I wanted to chime in here, I also have trust fund taxes ($4700) listed on my Chapter 13 as a priority. Filed May 07. In my case it's the state, not IRS, and they did NOT file a claim, the bar date has passed. Now, I have heard that the IRS, is on the ball, and does file timely claims with the BK court, if you opt for the 13.

Definitely, run it past your attorney. Mine has been less than helpful in advising me of how to procede...my gut tells me we should file a claim on their behalf, and let the Trustee deal with them. The state is still accruing penalties and interest as we speak.