Tag Archives: taxes

Will Filing Bankruptcy Stop ALL Lawsuits?

Personal Bankruptcy – Brevard County

Bankruptcy Attorney Melbourne Florida

If you have lawsuits filed against you, it may be time to consider filing a personal bankruptcy case. A personal bankruptcy case can be an effective way to eliminate certain collection lawsuits. However, it is important to understand that not all types of litigation are halted or eliminated in a Chapter 7 or Chapter 13. Below are a few examples of suits that are not stopped by your filing:

Family law matters

When you are involved in a case that involves a determination of child support, spousal support, or the establishment of paternity, your bankruptcy filing usually will not stop the family law court from proceeding with its case.

Criminal proceedings

Filing for bankruptcy protection cannot halt a criminal proceeding. However, if the charges against you include a debt that is related to your criminal charges, that portion of the case against you may be halted by the automatic stay.

Tax proceedings

The law provides that the Internal Revenue Service (IRS) has the ability to continue pursuing certain audits, issuing tax deficiency notices, demanding tax returns, or issuing tax assessments against a debtor in bankruptcy. The automatic stay will prevent the IRS from issuing tax liens, repossessing property, or seizing your income will your bankruptcy case is pending.

Pension loans

A debtor is allowed to have funds withheld from his or her wages to repay a loan from certain types of pensions.

If you are planning to file a bankruptcy case and you have lawsuits or forms of legal proceedings filed or pending against you, contact us to discuss what will or will not be affected by the automatic stay. We can review all of the cases pending against you and make sure you understand what your bankruptcy filing will mean in each matter. We can also confer with the other parties involved if necessary so everyone is on the same page regarding your case.

Speak with an experienced Attorney at Faro & Crowder, PA 321-784-8158

The above are just a few examples of the types of legal proceedings that are not halted by the automatic stay. If you are interested in learning more about how a bankruptcy filing will impact your debt or the lawsuits pending against you, contact Faro Crowder, PA to schedule an appointment.  Our office is located in Melbourne, Florida.  We serve all of Brevard County and the Space Coast with Bankruptcy and Debt Relief services.

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Faro & Crowder, PA
Phone: 321-784-8158
Address:
1801 N. Sarno Road, Suite 01
Melbourne, FL 32935
Email: info@farolaw.com

We are a debt relief agency. We help people file for bankruptcy under the bankruptcy code.

IRS Debt in Bankruptcy

If you are past due on your taxes, you are likely wondering if you can discharge the debt in your bankruptcy. It is important to have a seasoned bankruptcy attorney review your taxes and help you understand what is dischargeable because some taxes can be eliminated while others cannot.

IRS Debt Bankruptcy | Brevard County Bankruptcy Attorney

If you did not file your income tax return with the Internal Revenue Service (IRS), the tax debt does not qualify to be discharged. If the IRS filed a tax return on your behalf, it is not considered to be a filed tax return making your tax debt dischargeable. Your federal income tax debt should be eliminated in your bankruptcy if:

  • At least two years prior to your bankruptcy filing, you filed your tax return for the tax year(s) you are seeking to discharge
  • The tax debt that your are trying to discharge was due at least three years prior to your bankruptcy filing
  • The IRS has not assessed your liability for the taxes you are trying to eliminate within the 240 days preceding your petition date
  • You did not intentionally and willfully try to avoid paying your taxes

If you have tax liens recorded against you and you are considering filing a personal bankruptcy, it is important to understand how they will be handled in your case. Your personal liability to pay the tax lien is discharged in your bankruptcy filing; however, the lien is still valid.

What does this mean? In short, the creditor holding the lien cannot use collection efforts (lawsuits, garnishments, etc.) against you to satisfy the debt. Additionally, discharged creditors cannot pursue assets that you acquire after the bankruptcy, or assets that you exempted in your filing. So, if your bankruptcy discharge applied to older taxes, the taxing authority cannot garnish your future paychecks.

However, a lien against your property may survive the bankruptcy. A properly perfected tax lien can attach to all of your personal and real property in the county where it is recorded. The important determination is how valuable the property is that the lien attaches to. The IRS will not expend the time and money to pursue a tax sale if the property has only minimal value, which is often the case.

It is also important to note that tax liens expire. The statute of limitations for most federal tax liens is 10 years from the date the tax was assessed (not the date the lien was recorded). As a result, many people rely on the passage of time to resolve their tax lien after a bankruptcy filing. It may also be possible to negotiate the release of the lien for a small settlement payment.

Contact a Brevard County Bankruptcy Attorney at Faro & Crowder, PA

No two cases are identical and how to handle taxes in a bankruptcy filing can be a complex matter. To get the legal help you need, call us to schedule a free consultation. We are located in Melbourne, Florida on Sarno Road and serve residents and businesses of the Space Coast and Brevard County.

Services Areas

We provide services throughout Central Florida including: Melbourne, Titusville, Palm Bay, Merritt Island, Cocoa, Cocoa Beach, Satellite Beach, West Melbourne, Cape Canaveral, Viera and Eau Gallie.

Get In Touch with Faro & Crowder, PA

Faro & Crowder, PA
Phone: 321-784-8158
Address:
1801 N. Sarno Road, Suite 01
Melbourne, FL 32935
Email: info@farolaw.com

The information on this blog or any blog is not intended as, and should not be taken as, legal advice.

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