Many northern New Jersey debtors living in communities in Bergen, Hudson and Passaic county such as Hackensack, Union City and Clifton find their wages garnished and bank accounts being seized by the IRS and state tax authorities for tax debts.  This is a major aggravation and some wonder if bankruptcy laws can help.  Fortunately the answer is yes.  You are urged to contact a bankruptcy attorney in Bergen/Hudson and Passaic County like Rafael Gomez for assistance.

Tax Debts

Tax debts may be discharged under certain circumstances.  For instance an IRS debt may be discharged in Chapter 7 bankruptcy when the tax due date was over three years ago, a return was filed for it over two years ago and the tax assessment occurred for it over 240 days ago.  The individual must have done an honest tax return with no tax evasion.

Even when you do not qualify for the above discharge through Chapter 7, you may still get bankruptcy relief through Chapter 13.  The tax bill may be included in a Chapter 13 payment plan spread over 5 years.  Meanwhile neither the IRS nor state may do enforcement actions!

May the Bankruptcy Trustee take IRS Tax Refunds?

Many wonder if the bankruptcy trustee may take an IRS tax refund that has yet to come in. The answer is yes and no.  The trustee may take that portion that is an asset at the time of the bankruptcy filing.  For instance if a filing is done July 1, 2011, the IRS may take the portion of the refund for 2011 for income from January 2011  through July 1, 2011. The filer may keep the portion for the last half of the year. A New Jersey bankruptcy lawyer who has helped many debtors in Bergen, Hudson and Passaic County like Rafael Gomez can advise you on how to avoid this situation with some planning.