taxes owed for current year

[tiredandbroke]

i am filing pro se chapter 7. after going over our budget for expenses i realized my employer was not withholding enough federal taxes. now i am looking at another 2900.00 tax liability for 2005. i am assuming i can list this on my expenses but i am not sure if i should average this out over 12 months according to what i should have been paying or list the amount i would have to pay per month until april of 06 to pay the full amount by filing time.

also, what about my current wages my wife and i just recieved? should i go ahead and pay my bills forward? is it better to file just before your payday or after?

[HHM]

You can list it as an expense, but it may not fly, since you don't really start paying on until mid next year.

First, do you think your BK will be an asset or no asset case. If its an asset case...here is what you do.

End your tax year on the date you file bankruptcy. That way, all the tax liability from January 1, 2005 to the date you file, Oct. xx, 2005, will became a priority claim against the bankruptcy estate. Thus, if the trustee recovers any money to pay to creditors, the trustee will pay this tax liability first. As a result, you will only be responsible for any remaining tax liability the trustee doesn't pay, and the post petition period tax liability, i.e. Oct xx, 2005 to December 31, 2005.

You may want to talk to a tax professional or go to the IRS website, www.irs.gov to find out the mechanics of ending your individual tax year early.

As for when to file, you want to file when you bank account is at its lowest, this is usually just before pay day.

[tiredandbroke]

i am sure i am a no asset case. i already am making payments to the fed and that wont be paid for another 16 months for 03 taxes. i dont believe the irs will allow you to add to an already delinquent balance. i am going to have to somehow come up with the 05 taxes by april. seems to me it would be a legitimate expense as it should already be deducted from my check??

[HHM]

Ok, now that you have filed in the picture further...

With all this prior tax liability, are you sure a chapter 7 is right for you. A chapter 13 might be a better option to help you get out from under the taxes.

Second, I think more than ever, you should think about ending your 2005 tax year at the time you file bankruptcy, at the very least, it will establish your pre bankruptcy and post bankruptcy tax liability.

Third, are all these taxes income taxes; it sounds like it from the way you describe it, so I will assume that is the case.

Fourth, whether you case is an asset or no asset, will depend on several factors. With that kind of tax liability, I am guessing you have decent income, so a chapter 7 may not be an option for you in the first place.

Add up all your living expenses (do not include payments to credits, even the IRS) and see if you have more income than expenses. Living expenses are more than just your fixed expenses, i.e. don't forget things like hair cuts, hygeine, etc. if you have money left over at the end of the month, you will probably not qualify for a chatper 7 and have to do a chapter 13. But, because your debt consist or recent, unpaid taxes, that is not a bad thing.

[tiredandbroke]

my income will probably fall around 58k although this is not a lot of money for the area i live in. i also have around 8k in old med bills around 6k in charged off cc bills and another 9k in old loans which stem from a job loss in 98 (company closed overnight) and we just never recovered. my expenses with the 05 tax liability is about 60.00 to the postive. my income varys from month to month and it looks as if may even decline significantly thru the end of the year. my concern if i went 13 that i may not be able down the road to make the payments on it??