Photo by Joshua Sukoff on Unsplash. An income tax lien creates challenges, so try to file bankruptcy to prevent one. Otherwise, bankruptcy can often help deal with a tax lien. This blog post continues a series about the smart timing of your bankruptcy filing. (It was interrupted by two blog posts updating federal unemployment benefits.) The last one in this … Read More
Photo by Manasvita S on Unsplash How do you time your bankruptcy case to write off income taxes? Usually you just need to wait long enough (but there may be other factors). Our blog post of two weeks ago introduced the importance of timing your bankruptcy filing right. We gave a list of 15 examples of timing considerations. Last week … Read More
In spite of you filing bankruptcy, the taxing authorities can still take certain very specific actions as exceptions to the automatic stay.
Chapter 7 sometimes doesn’t give much help with tax liens. But Chapter 13 hugely helps with tax liens already recorded, and stops new liens.
Creditors with secured debts often have much more leverage against you than with unsecured debts.
A tax lien fully encumbered by the equity in your home is dangerous. Chapter 13 may be your best option.
Chapter 13 forces the IRS/state to accept only partial payment on an income tax debt that is only partially secured by a tax lien.
Once an income tax lien is recorded, Chapter 13 gives you a tool that may enable you to pay no more and yet get a release of that tax lien.
The recording of an income tax lien turns your home into collateral on the tax you owe. Stop the IRS/state from getting that huge advantage.
Chapter 13 handles a tax lien on a home especially well when the home has enough equity to cover some but not all of the tax lien amount.
Chapter 13 takes away the danger of a tax lien encumbering the equity in your home. If the IRS or your state tax collector records an income tax lien against your home, and you want to keep the home, sometimes through bankruptcy you don’t have to pay the tax. If there’s no equity at all in the home to … Read More
If the IRS or state has recorded a tax lien on your home, sometimes a Chapter 13 “adjustment of debts” can get rid of both the tax and the lien. Income Taxes that Can Be “Discharged” (Legally Written Off) If you owe an income tax debt, it can be discharged like most other debts. The tax debt just needs to meet … Read More
Having unpaid property taxes is dangerous, and violates the contract with your mortgage lender. Bankruptcy addresses both issues. Is Chapter 7 “Straight Bankruptcy” Enough Help? It possibly can give you enough of a fresh start with your other debts so that you can catch up on your property taxes. But doing so while keeping your mortgage lender also satisfied is difficult to pull … Read More
As of January 1, 2016 you can include any taxes you owe for the 2015 tax year in your Chapter 13 payment plan.
If you don’t have much equity in your home, so that a tax lien eats up all that equity and then some, how can you get rid of that tax lien?