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?
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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.Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
Status: (Auto) Discharged and Closed! 5/10
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Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.
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