What are the pros and cons of filing Bankruptcy to discharge my IRS tax debt? From Tax Debt Advisors, Inc.
Discharging IRS Tax in Bankruptcy Phoenix AZ
Pros
Immediately there is an automatic halt of all collection action by the IRS. Discharging IRS tax in bankruptcy Phoenix AZ can be used when an IRS Offer In Compromise is rejected or you do not have the funds to pay the amount the IRS wants to be paid with your Offer. It may be possible to wipe out all interest, penalties and tax liability.
Cons
Discharging IRS tax in bankruptcy Phoenix AZ will hurt your credit. Some taxes such as payroll tax debts are not dischargeable. Attorney fees are expensive. If you are close to the statute of limitation, it maybe better to enter an installment arrangement or non-collectible status until the time the IRS has to collect the tax expires.
If you filed a fraudulent return it cannot be discharged in bankruptcy. There is a waiting period of two years from assessment and three years from the due date for filing the return.
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My service to you is to tell you when your taxes are dischargeable in a bankruptcy and compare filing a bankruptcy with other IRS settlement options. I will then refer you to a competent bankruptcy attorney who will determine if you qualify to file a bankruptcy and answer any questions you have on how IRS tax bankruptcy will affect you.
Scott Allen, E.A. – Tax Debt Advisors, Inc