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The founders of our country understood that a fresh start under federal law is so essential to the fiscal health and economic vitality of our country; they included the right to file bankruptcy in Article 1, Section 8 of the United States Constitution.
Trying to repay the IRS in an installment agreement can be difficult. While an installment agreement may keep the IRS at bay, you may find yourself making little or no progress toward paying off the tax debt because the tax code and the IRS offer no real way of stopping interest and penalties from continuing to accrue. In fact, the interest and penalties the IRS charges doubles the original amount of tax you owe every five years. Furthermore, the IRS is not bound by the agreement. The IRS can, and often does, change the terms of the repayment after deciding that you are not paying enough compared to your income.
Making your installment payments through a Chapter 13 Plan designed by you and your attorney rather than an installment agreement dictated by the IRS can result in substantial benefits to you. Chapter 13 stops the IRS from charging you interest while you make your payments. Chapter 13 can stop the accrual of IRS penalties. For older taxes, under certain circumstances, the amount of tax, interest and penalties repaid to the IRS can be significantly reduced or eliminated altogether. Once you file a Chapter 13, the IRS is prevented from levying your bank accounts, seizing your property or garnishing your wages and will stop a levy, seizure or garnishment already in progress. Bankruptcy law can allow more flexibility in your budget by allowing you to claim expenses which are not allowed by the IRS in formulating an installment agreement.
A Chapter 13 may allow you to pay far less to the IRS than you owe. Resolving IRS debt through a Chapter 13 bankruptcy can stop interest and eliminate penalties. Chapter 13 can even reduce the amount of tax you pay. This often results in shortening the time it will take you to repay the IRS.
Contact us today to learn more about your options under the current bankruptcy laws. We're here to help. Have questions on filing for bankruptcy and need a Dallas bankruptcy attorney or a Fort Worth bankruptcy attorney? The Patrick D. West Law Firm, P.C. has been providing bankruptcy and debt solution legal counsel for over 20 years. The law office serves bankruptcy clients in these DFW area cities in both Dallas & Tarrant Counties: Dallas, Fort Worth, Arlington, Irving, Grapevine, Grand Prairie, Euless, Bedford, Hurst, Haltom City, Burleson, Colleyville, Mansfield, Keller, Saginaw, West Lake, Richland Hills, Coppell, Lewisville, and more