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Update on my IRS taxes

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    Update on my IRS taxes

    The back story is we filed for BK in 2018, we hadn't paid the 2017 taxes, but the trustee paid it as a high priority.

    Each year we filed taxes. However, we always owe. When the 2018 taxes came due, we did not have the cash to pay it. Then the same thing happened in 2019 and 2020 and 2021. We had little to no disposable cash especially early in the BK.

    We owed taxes for 2018, 2019, 2020 and 2021. We made some small voluntary payments but didn't put much a dent in it. I was determined to pay off as much as possible before BK was scheduled to end April 2023. Then we had the lovely news that our BK13 was discharged EARLY, by almost a year. I was worried since we owed, but the IRS was surprisingly easy to deal with, however not all of the representatives on the phone are not as educated on the BK/discharge process. Even those who didn't have an answer were polite and really tried to help. After the discharge we were allowed to make a payment plan or to set a payoff of the entire amount in 6 months. We chose 6 months since it was cheaper (no extra charges), there's large charges to make a payment plan.

    Today we made the last 2020 payment and put $50 towards 2021. My personal goal for payoff is December before the holidays. We have until mid January.
    I am not an expert. I just share my experiences in the Wonderful Wacky World of Chapter 13! Filed 3-30-18 Confirmed 7-11-18 Discharged 6-8-22

    #2
    I'm glad that the IRS was easy to deal with. It will be a big relief when this is taken care of in a few months.

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      #3
      In bankruptcy, the IRS is shockingly easy to do business with.
      Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
      Status: (Auto) Discharged and Closed! 5/10
      Visit My BKForum Blog: justbroke's Blog

      Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

      Comment


        #4
        Originally posted by justbroke View Post
        In bankruptcy, the IRS is shockingly easy to do business with.
        This was all post petition non payment. I was worried at discharge they would be after us ASAP. But it was so laid back and when I called for my options it was all matter of fact and easy to set up!
        I am not an expert. I just share my experiences in the Wonderful Wacky World of Chapter 13! Filed 3-30-18 Confirmed 7-11-18 Discharged 6-8-22

        Comment


          #5
          Carmella, that is wonderful news -you'll finally be able to be current on those cruddy federal taxes!
          So far, we have been very lucky never to get behind and owe more than we could pay all at once.
          Most years, we got a decent refund even after my engineer husband calculated down to the penny early in the year and tried to change the allowances so we would get less money back. I think in Colorado we were always overcharged for the state taxes, but I'm not sure why we usually received a federal refund, even during the BK13.
          I am expecting a sizable IRS bill in 2023 because of the increased salary and the $2000 401K that went into default despite our best efforts to keep it paid up and avoid the penalties and fees we will owe next year.
          I will definitely post how it turns out, in case another forum user couldn't prevent a 401K default and is dreading the potentially expensive consequences.
          Of course, if any relocation costs that the Washington company didn't cover end up being eligible for a refund through the IRS, then that might offset what we owe enough to make that 401K penalty and raise not as devastating financially as we anticipate.

          Comment


            #6
            Something I eventually want to figure out is how much to have deducted extra to avoid having to pay as much when we file. Maybe it's a moot point if my husband decides to retire from full time work within less than 2 years. Maybe I should just wait it out. Our budget is still being adjusted and hopefully the beginning of next year we will have it set and include money set aside for property and income tax, etc. Once the garage repairs are paid and my husband has his own car we can get a better picture of how much money we are spending monthly. I am keeping my second job even though I feel like cutting back especially since I am trying to transition careers if I give up full time clinical work it would be nice to still do this other job that can be 0 to 7 hours a week and keep my clinical skills active. The extra income always helps now especially now that it is really extra income!!
            I am not an expert. I just share my experiences in the Wonderful Wacky World of Chapter 13! Filed 3-30-18 Confirmed 7-11-18 Discharged 6-8-22

            Comment


              #7
              Carmella I'm so glad to hear you are getting your tax situation sorted. You are well on your way to a new life and financial freedom!

              Comment


                #8
                @Carmella..yay, I’m glad you got this situation sorted out and the end is so close..talk to your payroll department for information on taxes..they can’t advise you but can give you general information.
                Filed Chapter 13 - 07/20/12
                Discharged 8/2/16

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