Resolving Bankruptcy And IRS Issues
When job loss, a bad economy, illness, divorce or another setback causes financial problems, many people reduce their tax withholdings and claim extra dependents to increase their take-home pay. When the IRS comes knocking at the end of the year, many people don’t have the funds to pay their taxes.
When you are late on your taxes, interest continuously accrues and late penalties can be applied to your debt. The result is often large, overwhelming tax debts.
At the Law Offices of Buddy D. Ford, P.A., in Tampa, we help individuals and businesses throughout Florida eliminate or reduce their federal tax debts through bankruptcy. Our lawyers understand the laws surrounding bankruptcy and Internal Revenue Service tax debts and know how to make the law work to your advantage.
Discharging Tax Debts Through Bankruptcy
While many tax debts are dischargeable in bankruptcy, some are not. The key is in knowing the difference.
In general, tax debts that are less than three years old are dischargeable in bankruptcy. This includes not only the underlying tax itself but also all associated interest and penalties.
Our attorneys will evaluate your tax debts to determine whether they are dischargeable through bankruptcy. We will then advise you on the debt relief path that is best for you.
Debts Discharged During A Short Sale Or Foreclosure
When you surrender your property in a foreclosure or sell through a short sale, your remaining mortgage debt is forgiven. To the IRS, this forgiveness of this debt is considered income and is taxable. There is an exception in the Bankruptcy Code that makes this a nontaxable event. This means that tax debts owed due to foreclosure or short sale can be eliminated through bankruptcy.
At the Law Offices of Buddy D. Ford, P.A., we will help you understand how banks characterize forgiveness debt and the tax consequences of forgiveness and answer your questions regarding debt forgiveness during bankruptcy.
Contact Us For A Consultation
For more information about tax debts and bankruptcy, call our office at 813-302-1258 or 866-596-9247. You can also email us through our intake form.
We are a debt relief agency. We help businesses and individuals file for debt relief under the Bankruptcy Code.