I am back and need advice!

[car67]

Howdy group.

I have stabilized my life from self employed to actually employed over the last 2 years. I have managed to fight all the wars since 2009 using a Chapt 7 and two subsequent partial 13s to keep creditors at bay. Its been a chess match I have battled successfully so far. My home is also modified on the first and current and the second was discharged in the 7 back in 2007 and it just faded away. I know the lien is still on the house and I will deal with that another day.

My situation also involves a spouse who has a huge payroll tax penalty from doing the books at her dads business and her diverted the funds and didnt pay the 941 taxes and she got left holding the bag by the IRS. I got that moved to non collectible so another band aid on the grand scheme of things right? Trust me I have seen it all and have battled pretty good until now.

My problem is that now the state tax office is coming at us using the garnishment tool attacking 25% of her income. It will affect our take home net to make the current mortgage unaffordable until I deal with the garnishment which is $5000.00 The state tried to garnish us both but in our state if we are under one roof the household budget can only be garnished 25% so I got that squared away. Bk experts just so you know the wife cant file the 13 because of the payroll tax from 2007 will be considered a lead creditor. I am not sure when that time line will pass where she can use the 13 tool when or if needed.

My thinking since the house is current as of April 2014 is to just skip the mortgage payments 120 days and take the money and just slam it at the tax bill for the state so it would get the garnishment released from wifes check and then for me to try to ask the mortgage lender to re modify my loan to work with the 120 day arrears and if they refuse the request to simply hop into a 13 at the 120 day point when the state tax is paid and deal with the arrears in a 60 month plan to get a lower monthly on the arrears but work on paying the arrears OH yea here is other curve ball for yea I got a $20,000 k IRS bills from 2007 that is in my name as non collectible so as soon as I file any 13 that opens that debt back up?

If it wasn't for the wage garnishment on wife pay I could keep the creditors at bay......... I am working on getting my income up and I am on the right track............ We can afford the mortgage if it wasnt for the set back on the 25% garnishment on her side........

I am asking for advice and strategies from the experts...... THANKS CAR67 Ps my attorney is the best in 13 out this way and I may not need to file if the house banker will work with me on this temp set back issue.......

I am not in any chapt 13 at the time.

Pointers and advice welcome from the gallery! Thanks always u guys always have the best talent and advice!

[justbroke]

First, unless your 2007 IRS debt has a lien associated with it, it would be dischargeable in a Chapter 13 (and treated as a "general" (non-priority) unsecured debt.

Second, how would your wife NOT be able to file a Chapter 13? Do you mean that the debt to the IRS (941 taxes) is so large, that you couldn't fund a feasible Chapter 13 Plan? Some portion of the 941 taxes may actually be dischargeable. Have you consulted with an expert bankruptcy attorney that specializes in small business and tax debt? You might be surprised... but if this was fraudulent activity then that may cause issues. I would still consult with several experts on this topic!!!

Third, what happened to your 2010 Chapter 13? Dismissed or discharged?

You may have the best Chapter 13 attorney in the area, but you need a bankruptcy attorney that is a business tax specialist. There is no sense on here, BKForum, speculating what you might be able to do. Someone needs to look at the whole picture and look at various options including both Chapter 13 bankruptcy and maybe even an Offer In Compromise.

[despritfreya]

JB,

car67 appears to be a serial filer (filed a 7 and two 13s - don't know the date of filing or when each case ended).

Assuming the cases were filed between 2008 and 2013 the 2007 income tax obligation may not be dischargeable due to tolling. I assume it is not.

As to his wife's payroll tax obligation (I assume the trust fund portion for either state or federal) those are never dischargeable so I am not sure what he means by "I am not sure when that time line will pass where she can use the 13 tool when or if needed."

There just is not enough info here and I agree with you that he needs to get a better understanding of what he can and cannot do as it relates to the taxes. Sounds like the attorney he is talking to is not a good communicator or does not know how to deal with taxes in a bk, especially if a debtor has filed numerous cases over the past few years.

car67,

Don't screw up your mortgage payments at this time. Instead. . .

Please go back to your attorney and have him explain (in non-legaleez) the tax issues to you. You need to make sure he knows the exact date you filed your prior cases (2008 to the present) and the exact date each case was dismissed or discharged as the case may be. (I assume the only discharge you have is from the Chapter 7). With that information, if he knows what he is doing, he will be able to advise you when you can discharge the 2007 income tax (not payroll) obligation.

Once you know what you can and cannot do as it relates to the taxes you can decide how best to proceed. Holding off filing the Chapter 13 and paying off the state payroll tax obligation at the expense of 4 months worth of mortgage payments may be fine but there is just not enough info here to venture a guess.

Des.

[car67]

JustBroke thanks for the response, Yes Sir your correct her 941 liability is $150k plus and no feasible way to fund 150k over 60 months. So far the attorney I worked with is telling me none of the 941 or IRS tax is dischargeable. Little more to the story line. Up until 2011 I was self employed and stubborn and rode the economy from 1999 to 2011 till I finally tossed in the towel to become a working stiff and lost the desire to be in business due to the beating I took mentally, financially and emotionally.

I started off with a Chapt 13 in 2007 to deal with a medical bill but the economy worsened for me in 2009 so I converted to a 7. Did a successful discharge in 2009 via Chapt 7. In the mean time I was still stuck in a huge war with my mortgage company that took 3 years plus to finally win a modification. I had to use the front end of a 13 in 2010 to protect the house from legal foreclosure attempts while the paper sold on the first lien three different time spans to different mortgage services. In the meantime I kept hanging on to hope the business would bounce back. Well everything just got to the point at the end of 2011 I decided to close shop and go to work for someone.

DespritFrea One chapt 13 was converted to the Chapt 7 and then the second 13 was 2010 to use the automatic stay and some monthly payments to get eveything buttoned up on the mortgage I needed done to keep the loan servicer at bay on the house. I been in my house since 2005 and still here and will do what it takes to protect home. With the service provider selling the paper three times and endless wars with call centers in India I had to use the power of the automatic stay to keep any sneaky foreclosures off the radar.

Rest assured things are stabilized income wise for my family and things are paid off and manageable and finally got the house modified and settled with a fixed rate at 2% for 30 years. My hurdle is how to make the bills with the garnishment hitting the budget. I would simply do a 5 year Chapt 13 and plan for it to complete to month 36 or 60 but with the wife having the 941 issue which I am not tied too it leaves her unable to join the proposed 13 due to being unable to fund the taxes 100% over 60 months. So the state can still hold the garnishment on her and it does me no good to file solo with the garnishment on her side of the fence.

The 941 issue is from 2003 to 2006 and under the uncollectable status the IRS can no longer collect for taxes that have waited the 10 years so just looking at the view point as of 2016 the wife could join a 2013 if she needed too because the 941 liability would expire on the 10 year collection rule. We have kept the IRS informed.

This huge ball of wax was from several failed business ventures and then both me and the wife entering the work force to make bills as dual incomes from the emplyed sector. Hopefully my updated feedback will shed more light onto the questions provided. Thanks Car67

Ps if the tax bill on my side was from 2007 for the 20k, Are you guys saying its possible I do not have to fund that 100% over 60 months and some of it can be dischargeable since its been some time? If so that is a plus in my column!