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Video instructions and help with filling out and completing How Form 843 Bankruptcy

Instructions and Help about How Form 843 Bankruptcy

It's from Megan from Fort Myers if you owe the IRS money how does that affect bankruptcy is it dischargeable non-dischargeable can you still get audited and you have to give your tax refunds to your creditors so there's a lot in this thing let's just hit it one from a one from the start when you're dealing with the IRS in bankruptcy the first question you have to ask yourself is is it a chapter 7 or is it a chapter 13 then you have to get into how old the debt is whether or not the tax returns were timely filed where the tax returns reviewed by the IRS and was the assessment done and what's the amount of the debt I mean there's just a ton of information and then it got the 9 40s the 940 ones anyway general rule of thumb people think that taxes are non-dischargeable in bankruptcy I would disagree with that general rule and here's why certain taxes are dischargeable in bankruptcy when a debt gets beyond a certain age and if you've done everything right like filed your tax returns timely the assessment was done you've met the criteria of what needs to be done that debt loses its priority status and goes to what's called an unsecured non priority status if that's true that debt is a not as a dischargeable debt and it falls into the same category as let's say a personal loan let's say if I gave you $10 and there was no promissory note or anything it's a personal loan that's an unsecured debt there's no collateral between us it's the same thing as a credit card or a gas card or maybe a store credit cards are a little bit different Oh or even a medical bill or let's say you have a some other type of an account where there's no collateral securing the loan well then that would be the IRS that could fall in there with it as well so in that type of scenario yes the IRS that would be a dischargeable debt and it can be included in a bankruptcy proceeding so then you look at it say okay how does that affect your bankruptcy well IRS debts don't affect bankruptcy they're taken into consideration just like every other and and as a rule of thumb you can always say that if you owe the IRS money the debt has to be included there are no debts which are excluded from bankruptcy all debts are included some debts may be non-dischargeable like student loans like let's say you owe to IRS taxes for personal IRS taxes from 2022 that's such a new debt with the IRS it would not it would be considered a non dischargeable debt and let's say you come to me and you have this IRS debt well looking at it I would have to make a determination what's in your best interest and I would talk to you about this and say look folks this is a debt where you have to do a chapter 7 and you can wipe this debt out or you may want to kind of manipulate things a little bit let's say you do a chapter 7 you'll wipe out all the other debt then you come back and you do a chapter 13 and you say well I'm just gonna pay off the IRS this is a strategy we've employed quite often for a lot of individuals who were eligible for the 7 but they would have had to pay back extra in the chapter 13 had they just did the chapter 13 now all the naysayers are gonna say well why would you file two bankruptcies you're not allowed to get two discharges in that short of time frame and I say right that's that's correct you get your discharge in the chapter seven wipe out all the other debt then you go and use the chapter 13 to pay back your IRS with no interest no penalties and you don't get a discharge at the end but who cares you don't need a discharge this was a non dischargeable debt anyhow you're just using the bankruptcy process to pay back the IRS in a fashion which is comfortable to you and you have court supervision plus you have no interest no penalties that the IRS can tag on to you by the way that's on a debt that's an unsecured priority debt if the IRS at the lien on something and there it becomes secured by some collateral which we're going to get to in a second then they do get paid with interest so let's go to that one's the next question our next part of Megan's question was can i still be audited in a bankruptcy you got two different things going on here Meghan and awed it is one type of process that the IRS uses to basically make sure that your tax returns are correct now there's a lot of different definitions I'm not to talk about that here talk about let's say for example the IRS audits you because they don't think you did something right or you took too many deductions or whatever it doesn't matter I got a caller coming I'm going to break from that one second to take the caller let me finish this thought bankruptcy is another so if you're in a bankruptcy proceeding and you're paying the IRS back and you get audited on the other side the IRS can still look at your paperwork without trying to collect the debt.

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