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Very complicated BK/Tax Issues. Not sure where to start

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    Very complicated BK/Tax Issues. Not sure where to start

    First, here is a letter I sent today to IRSolutions. I would call them more of a CPA/business tax firm then a real tax resolution firm. He used to work for the IRS.

    Hi David,

    Hope all is well. First I want to make clear that I know this is my fault and not yours. I also recognize that it is your busiest time of the year with Tax season. The previous emails were ones I sent without reply. Again, I don't fault you. It is my responsibility and I did not follow you.

    My bank account has been levied on Jan 13th and again yesterday by the state the first for 282 I believe and yesterday for 1610. I should be specific and say the EDD. The last statement I have from them is Mail date 12/11/14

    Total Balance $14,572.70

    Period Ending
    TAX
    Penalty
    Interest
    Credit
    Balance
    30-Sept-2003
    $.00
    $180.00
    $119.71
    $11.21
    $288.50
    31-Dec-2007
    $3,892.81
    $1457.79
    $1721.22
    $0.00
    $7,071.82
    30-Sept-2008
    $0.00
    $80.00
    $18.86
    $0.00
    $98.86
    31-Dec-2008
    $6,786.17
    $696.62
    $1,486.50
    $,1855.77
    $7,113.52

    EDD State Levies

    Date
    Amount Debited
    Bank Processing Fee
    Overdraft Fees
    1/14/2015
    $282.84
    $100.00
    $
    2/04/2015
    $1610.75
    100.00
    $35.00-I currently have a negative balance of $458.70 so I am not sure how much those fees will increase not to mention the inability to pay outstanding bills including a $300.00 check to the IRS.



    Again, this is before the two most recent levy's. It should be noted that the state garnished my wages between approx. 2010 and 2013 for personal taxes of approx $15,000 dollars which after penalties and interest totaling over $30,000. This is now paid in full. Why didn't they just address it all at once??

    As far as Federal Taxes, I have no idea. Last I spoke with you, you were able to stop a paycheck garnishment for back taxes totaling ???? $125,000. At that time we were already in a tax payment plan for $6,000.00 for the 2012 tax season paying $300.00 per month. We had made one payment when you advised us to stop until you could review all of the tax documents you had requested from both the state and IRS. On November 13th 2014. Edyee's Bank account was levied for $1256.93 because of non payment on the Installment agreement of the 2012 taxes. The one we were advised to stop paying until we could gather the information. I have since resumed payments of $300.00 and have made two of them. The third payment I made will now bounce because of the EDD State levy on my account.

    In addition, as I previously said I expect to owe an extra $6,000 for 2013 and possibility as high as $25,000 for 2014 federal taxes. I have no Idea about the state.

    I need solutions and advice. I know I paid you $3,000.00 for the stopping of the paycheck garnishment but I know longer know what to do. As an aside, my wife already as a 25% garnishment for $7,000.00 for an unrelated tax issue. I am at the peak of my earnings and in fact me income went down approx $30,000 last year to $100,000. Her income was approximately $25,000k.

    My one fear with you David is I have always felt that your true heart is with the IRS. I need true legal guidance with considerations like injured spouse, divorce, alimony and/or her quitting her job that will maximize our chances to finally put this behind us. I will have to file bankruptcy but I want it after the tax resolution. Her amount of liability is for 2012, 2013 and 2014. My liability is for everything else in addition to those years. If she is divorced receiving alimony and can file injured spouse limit her exposure? If I am divorced paying alimony does it increase my chance to receive a settlement.

    You see my quandary. With you not being attorney you can be made to testify against me. That with my "gut" feeling, and that does not make you a bad or evil person by the way, feels that your heart and mind will always have a bit of it affiliated with the IRS.

    The only thing I am sure of is if I am not here, then very little liability lies with my wife. Again, I am not sure what $3000.00 entitles me to as far as services but if you feel that my case is to complicated or perhaps not in your "Wheelhouse" then please let me know.

    Thank you,

    Ken




    I have no idea where to start. If we stay married and she doesn't work with my income of about 100k-I don't believe I would qualify for chapter 7 which leaves 13 and 5 years.....the entire time the taxes sit and accrue. Deal with the taxes, California is they take a settlement requires payment in full. The IRS will take payments but the poor credit lingers and pretty much eliminates me getting a different job. If we divorce, her exposure is very little. But then when I settle with IRS/BK I have no writeoffs......I am not sure if they would consider alimony.

    Like many, I am worth way more dead then alive and shield her from too much tax liability.

    Does anyone know of a Tax forum like this?? Haven't found one yet.

    I should add that my bankruptcy would be considerable, about 200k from failed business and about 20 k from non dischargeable student loan. I work as a RN now

    #2
    Don't take offense but I have to ask, why not just pay your taxes when you are suppose to? Its not like taxes are not expected in this life (kind like Christmas, it comes every year on the same day) so I am always amazed when I read things about taxes not being paid. You need a tax attorney obviously, very obviously. Why not start there? This person you wrote the letter to is not a tax attorney (by your statement in the letter) so I am not sure why you are not running to a tax attorney.

    How do you eat an elephant? One bite at a time, get yourself an attorney.

    Comment


      #3
      Consult with some BK attorneys too. Taking care of the tax issues before filing BK may not be your best strategy. You need some good legal advice.

      I doubt divorcing your wife will save her any liability for years in which she was married to you. If she is already on the hook, divorce won't change that.

      Don't be afraid of a Chap 13. If it is the right solution, it is not the end of the world. It will help keep the taxing authorities out of your hair for a while.
      LadyInTheRed is in the black!
      Filed Chap 13 April 2010. Discharged May 2015.
      $143,000 in debt discharged for $36,500, including attorneys fees. Money well spent!

      Comment


        #4
        Drazil65,

        It was difficult to not take personally. None of us get to these forums by accident. Whether bankruptcy or TAX problems, obviously we/I have made mistakes. I have worked since 17 and at times two jobs. I put myself through college and nursing school. I never lived at home after 17. I have never been on welfare, food stamps or unemployment. I have owned a house and the things that go with that. I made mistakes though. I left a great LA county job with 10 years and another 10 to go until retirement at age 39. I had a stupid idea of trying to start a business, a mistake I will regret forever. Failed business, divorce....will I am sure you know the story. During these intervening years I paid over 30k in back state taxes and 40 k in child support. I own nothing now. Which ever route I take, chapter 13 first or state and federal taxes first....well I am 52 yo now. I am looking at a 10 year journey which ever way it works out. I will be 62 then. I work in the ER and trust me, 12 hour shifts are already not easy. As much as I like the ER, 12 hour shifts at 62??? This is also my peak earning potential. Not many if any nursing jobs pay better.

        So what's left. 6-8 years left to work on retirement, social security income. No retirement, no house. This is the legacy I leave behind. I have cared for people since age 17 and my value to society remains unchanged.....a paycheck. I do not believe I am the only one here that sometimes wonders if death and life insurance isn't a better outcome. Maybe even prison sounds peaceful at times. If only I had paid my debts on-time.

        Though my thread was directed towards you......really my anger, sense of failure and self worth far exceed your good will.

        Comment


          #5
          You are right, many have gone before you in same/similar situations BUT we have moved on to pick ourselves up and move forward. There are worse things in life then being 62 in 10 yrs and still working (take a walk through the burn unit of St. Jude's children's hospital if you want to be humbled). Be grateful that you have a good job at 52 and are healthy enough to be thinking about working for the next 10 yrs.

          You know what you need to do so start doing it and leave the pity party at the door. I am sorry but it is what it is and you move forward, you fix things little by little and you learn your lessons financially. Forget about the retirement and the fact you do not have a house, minor inconveniences that do not identify who you are (or shouldn't anyway). I assume you have the basic necessities (roof, food, water etc) since you have a good job so move on from that stuff. Deal with the here and now, make yourself some appointments (several it looks like) with tax and bankruptcy attorneys and hit the ground running. You have a chance to do it right (ie: make better decisions) this time so why waste anymore time, just do it and move forward.

          Read everything here you can, read it all twice if you need to, make those appointments, adjust your attitude and put one foot in front of the other and go!!! We honestly do wish you the best...

          Comment


            #6
            You have not give enough info. It appears you owe a combination of personal income tax AND business related taxes (sales, payroll - not sure). Please list year by year and/or quarter by quarter the exact following items:

            1. State or Federal
            2. Type of Tax
            3. Current amount owed
            4. If the applicable tax return was timely filed and if not, when it was filed.

            Once we have that info maybe we can help.

            Point of fact is you needed/need legal advice on how to handle the taxes - not some company that touts it can “get rid of taxes or negotiate a settlement because we use to be revenue agents and know how the system works”. For example, you should have never ceased payments on an agreed to installment arrangement unless the IRS said it was ok.

            Des.

            Comment


              #7
              First off, you should not have allowed it to get this far. Once you got the official notice from the IRS that your account(s) will be levied, you needed to get on the phone ASAP and set up a payment plan. That would have bought you time and forgiveness.

              It looks like you ignored all this and are now playing 'catch-up'. As Des said, we really need more info. Are you dealing with both state and Federal, or just the Feds?

              This letter you quoted looks like a debt resolution service. If it is--flee for your financial life!!!

              A BK filing of any sort will stop or 'toll' the levies, until after you are Discharged. Get your ducks in a row and file. Give more information, and ask lots of questions. We are here for you. More to come later.

              My best~~~
              "To go bravely forward is to invite a miracle."

              "Worry is the darkroom where negatives are formed."

              Comment


                #8
                I did not read the entire letter, but from what I see, this looks like a run of the mill "used to work for the IRS" (yeah right) tax resolution service. These services are VERY convincing when you speak with them that they can resolve your problems and many people fall for them. The truth is that most are scams. You need to discuss your situation with a good bankruptcy attorney immediately, stop wasting time with a tax resolution "guy", you will just get in more trouble.
                Any information posted by me is for general informational purposes only. While I am an attorney, I am not YOUR attorney and any information I provide is not legal advice.

                Comment

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