Owe lots of back taxes...

[Vball]

We filed chapter 13 last year and included about $20,000 in back taxes. Now we are switching to a chapter 7 due to job loss. No funds were paid to any of my creditors including the IRS. I know that taxes are not dischargeable and we will have to pay them. What's the best way? Do we try to work with the IRS directly for a payment plan? Get another lawyer that advertises back tax issues? We do not have any money in savings to make any kind of lump sum payment - not even a couple hundred bucks. I don't really want to get my wages garnished. If it gets that far, how much can they take from my paychecks?

[shipo]

My family and I have ended up behind the ball with the IRS several times over the years; if you are proactive and call them to try and work out a plan, they have been, ummm, reasonably reasonable, if you know what I mean.

[sophieanne]

I agree with @shipo...calling the IRS is the best way to go. I've found them to be very helpful and fair when I've dealt with them over the years.

[justbroke]

You will definitely need to go into a payment plan. Since it's less than $25K, you can do it online under the streamlined Online Payment Agreement (OPA) process. You will need to wait until you are discharged from your Chapter 7 before you can enter into the agreement. It's generally amortized over 6 years at about 5%. At $20K and at that rate, 5%, it's about $325/month, give or take, for 6 years.