Phoenix IRS Tax Debt Bankruptcy Lawyer
Speak with a Phoenix bankruptcy attorney about overdue taxes and how to clear up your IRS debt. Call (602) 466-9631 to schedule a consultation.
IRS Tax Debt Attorney in Phoenix Helping You Get Back on Your Feet Again
Phoenix is a wonderful place to live. At Hilltop Law Firm, we’ll help you resolve your financial issues so you can get back to enjoying all the great things Phoenix has to offer, such as walks around the Desert Botanical Garden, hikes along Echo Canyon Trail, and Diamondback games at Chase Field.
When you are behind on your taxes, it isn’t treated like other types of debt. The IRS debt applies strict interest and penalties that will continue to compound until your debt is resolved. But you have options to fix the situation.
Unfortunately, there are a lot of disreputable for-profit companies that claim to offer tax debt relief but will simply take your money and do little or nothing to improve your life.
The best way to resolve IRS debt is with the assistance of a reputable debt relief lawyer. Your attorney will show you how to reduce your obligation, eliminate liens, and get your financial situation back on track.
If you have overdue taxes and penalties and you don’t know how you are going to cover your bills, contact Cy T. Hainey today. Cy will go over your options so you can decide if bankruptcy is the right way to clear up your IRS debt.
Cy T. Hainey has been working as a Phoenix bankruptcy attorney for over ten years and has a deep understanding of federal tax laws. Our legal and financial team at Hilltop Law Firm will help you achieve a debt-free future.
Call (602) 466-9631 to schedule a FREE consultation today.
What Is IRS Tax Debt?
Tax debts are unpaid taxes that a person owes the IRS. This includes any taxes you owe after the filing deadline passed. Unpaid income taxes are subject to penalties, usually five percent of the tax owed per month. The IRS will continue to charge interest until you pay off the balance. There are also late payment penalties that will continue to add up.
When you owe the IRS money, they can put a lien on any property you own, including your home. This is a legal claim that can be used by creditors as collateral to collect debts. If there is a lien on your property, you will not be able to sell it.
Tax debt is different from other types of debt. The federal government will continue to pursue you until they get what they’re after. The good news is that you have options. But there are strict rules and deadlines that must be observed, so the sooner you get the ball rolling, the sooner you can put this problem behind you and get on with your life.
IRS Tax Debt and Chapter 7 Bankruptcy
Two types of bankruptcy can help you resolve your IRS debt: Chapter 7 and Chapter 13. Your bankruptcy lawyer will go over the pros and cons of these options. Your income tax debt may be completely or mostly discharged as part of a Chapter 7 bankruptcy.
When you file for Chapter 7 bankruptcy, a trustee will be assigned to sell off a portion of your assets and use the money to pay off creditors. Arizona law allows you to exempt certain assets with Chapter 7 bankruptcy. You may be allowed to retain your vehicle, clothes, tools, and other personal belongings. You may also be allowed to keep your home with Chapter 7 bankruptcy, depending on the size of your payments and the total amount of home equity.
The following conditions apply when resolving IRS tax debt with Chapter 7 bankruptcy:
- Only income taxes are eligible for discharge.
- There can be no tax fraud or tax evasion.
- Tax debt must be at least three years old.
- You must stay up to date with current taxes.
- Taxes must be filed at least two years prior to applying for Chapter 7.
- Tax debt must be assessed by the IRS and entered into the record at least 240 days before filing for bankruptcy.
IRS Tax Debt and Chapter 13 Bankruptcy
Chapter 13 bankruptcy allows a wage earner with regular income to restructure their debts. Under Chapter 13 bankruptcy, your trustee will negotiate with your creditors and develop a payment plan that gives you three to five years to clear up your debts.
Under Chapter 13 bankruptcy:
- Tax debts older than three years may be forgiven.
- IRS liens will be removed.
- Discharged debt won’t incur additional interest or charges.
- You must provide tax returns from the previous four years.
- You must continue to stay up to date with your taxes.
Hilltop Law Firm Is Here To Help
Contact Hilltop Law Firm and let our Phoenix legal team help you get back on your feet again. Cy T. Hainey understands that each client faces a unique set of challenges. He provides each of our clients with individual attention so we can design a custom-tailored plan that’s right for you.
Call us at (602) 466-9631 to learn more about your options with a free consultation.