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At Solvable, we care about your financial well-being and are here to help. Our research, articles and ratings, and assessments are based strict editorial integrity. Our company gets compensated by partners who appear on our website. Here is how we get compensated.
At Solvable, we care about your financial well-being and are here to help. Our research, articles and ratings, and assessments are based strict editorial integrity. Our company gets compensated by partners who appear on our website. Here is
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Carefully consider all options available to you concerning tax debt.
Solvable is your home base for all things taxes.
Taxes are just a way of life and should be maintained to prevent issues such as tax debt. Sometimes there is no way to avoid tax debt, but there are ways to resolve outstanding debts with the Internal Revenue Service (IRS) or your state revenue service.
This is where Solvable comes into play offering the knowledge and services you need to find tax professionals suited to handle all of your tax problems.
The basic definition of bankrupt is when a person or organization cannot pay outstanding debts by a declaration of law. The United States Bankruptcy Code outlines bankruptcy. Does bankruptcy clear tax debt? Let’s delve deeper into what bankruptcy is and how it influences tax debt.
Chapter 7 Bankruptcy
Chapter 7 is one of the most common forms of bankruptcy. Often referred to as liquidation, this is the most filed type of bankruptcy. Businesses can file Chapter 7 but only with the intent of liquidating their assets and ceasing business permanently. When filed as an individual, a trustee will collect your nonexempt assets. Once these assets are obtained they are reduced to cash and distributed to the creditors. You should only consider this option if there isn’t any hope you will be able to repay any debts you may owe.
In most cases, when your Chapter 7 bankruptcy has concluded, you may receive a discharge that releases you from any personal liability regarding specific dischargeable debts. This is all determined by the unique circumstances of each case.
Chapter 9 bankruptcy’s purpose is to give protection to a financially distressed municipality from any creditors. This protection is allowed so the municipality can work to develop a plan to adjust its debts. Chapter 9 will not allow a municipality’s assets to undergo liquidation or distribution of the assets to creditors.
Towns, cities, villages, counties, municipal utilities, school districts, and tax districts all fall under what is considered to be a municipality. A municipality is the only entity able to file for Chapter 9. The expectations placed on a municipality after filing is for it to restructure and to devise a plan of repayment.
Chapter 11 Bankruptcy
Chapter 11 is also known as a reorganization. Commercial enterprises commonly use Chapter 11 bankruptcy. It allows for business operations to continue as creditors are repaid via a court-approved reorganization plan. After being filed, there is a 120-day window in which the debtor’s reorganization plan will need to go through disclosure with the creditors.
The creditors can evaluate the plan, but it falls solely on the court to approve the proposal. The primary goal of filing is to bring the business back to a state of profitability. The key for Chapter 11 to work is to make every effort to avoid any additional debt.
Chapter 12 Bankruptcy
Chapter 12 is intended for family farmers and fishermen that bring in a regular annual income. Chapter 12 requires the debtor to submit a plan to repay their debts throughout a three to five-year period. There is a trustee appointed to the debtor to manage this process and is responsible for disbursing payments to the creditors. The family farmer or fisherman is unimpeded in regards to operating their businesses.
Chapter 13 Bankruptcy
Chapter 13 requires that you maintain a steady source of income, are willing to pay your debts, and that you can’t presently repay your debts. In most cases but not always, the debtor is allowed to retain a precious asset such as their house. The debtor has to design a plan detailing how they intend to repay creditors within a three to five-year period and present it to the court.
If approved, a trustee is appointed to the debtor which handles all payments to the creditors. Choosing Chapter13 over Chapter 7 may be in your best interest if you owe debts that are not dischargeable through Chapter 7. These debts can be taxes, child support, liens that are greater than the assets securing the deficits, taxes that have not been filed for an extended amount of years, late bills, or available exemptions that aren’t enough to cover your assets.
Chapter 15 Bankruptcy
Chapter 15 provides a means by which cross-border insolvency cases can be handled. This applies when an individual or a business has connections to assets in more than one country. The sole purpose of Chapter 15 is to foster cooperation between the United States court system and whichever foreign court system that is involved. This cooperation also extends to all foreign authorities that may be relevant in a cross-border insolvency case.
Does Bankruptcy Clear Tax Debt?
All the different types of bankruptcy can be overwhelming to think about but having a basic understanding of what bankruptcy is will help you determine if it is the best course of action to take when working to clear tax debt. Tax debt has a certain persistence about it, making it difficult to resolve in a way other than paying the debt.
There have been circumstances where bankruptcy has helped those looking to clear tax debt. Lots of factors come into play when taking this approach. The dates that your required returns were filed. How old the taxes are. The most recent date that the taxes were assessed by the IRS or your state revenue service. Last but not least is your determination to pay the debts you owe. The bottom line is that bankruptcy can help clear tax debt but may not clear it entirely. Tax debts are highly subject to timeframes, and there are those that are just not dischargeable.
In the world of taxes, staying current on all your tax obligations is by far the best thing to do. If you have tax debt weighing you down, don’t give up. Take the initiative and use Solvable to seek out the help you need. It’s as simple as clicking the right link.
Solvable is a for-profit company that helps customers resolve their tax problems, but a free service for consumers. Partners cannot pay us to guarantee favorable editorial reviews or ratings. We do not publish favorable (or unfavorable) editorial reviews or assessments at the direction of an advertiser or partner. We always work to put consumers first and do our best to provide value in meaningful ways, but our reviews are subjective.
How We Make Money
Solvable is compensated by some of the companies seen on our website. Most often, Solvable receives fees when one of our readers clicks, fills out a form, applies for, or receives a financial product from one of our partners. We also earn fees for capturing consumer stories and writing about them, displaying advertising, having our partners sponsor certain parts of the site, and writing content that may be relevant to our partner and their audience. This compensation may impact where products appear on this site, including article pages, comparison listings, the order in which they appear or if they will even appear on a given page, and our matching recommendations. Solvable has not written about, reviewed, or rated all financial products available to consumers.
In addition, we may be compensated in the following ways:
Referrals to consumers who use the online form or locator line that may provide expert answers to questions;
Marketing tax resolution, tax preparation, tax audit help and general tax assistance.
Referrals to services that help consumers with tax resolution, tax preparation, tax audit help and other tax issues.
We do recommend that you shop around and compare services and costs with other companies while performing your own due diligence, especially since people’s experiences with companies can change over time.
Free Solvable Services
The offers that you are matched up with are from companies or attorneys/law firms that we may receive compensation from. Based on our initial review of such companies or individuals, we feel comfortable introducing them to our readers. We won’t recommend something just because we’re offered payment to endorse or promote it. However, we do recommend that you shop around and compare services and costs with other companies while performing you own due diligence, especially since people’s experiences with companies can change over time.
We are not attorneys and we don’t provide legal advice. As always, we encourage you to do your homework and check out individuals and companies before you hire them. If you are already working with an attorney, we urge you to ask them your questions. After all, they will be familiar with your situation and the laws in your state.
We hope that you find Solvable helpful in your efforts to get a fresh start.
Personal Loans Advertiser Disclosure
The Personal Loan offers that appear on this site are from companies or affiliates from which solvable may receive compensation. This compensation may impact how and where products appear on this site (including for example, the order in which they appear or whether a lender is “featured” on the site). solvable does not include all Personal Loan companies or all types of offers available in the marketplace.
Personal Loan Providers determine the underwriting criteria necessary for approval. You should review each Provider’s terms and conditions to determine which loan works best for you and your own personal financial situation. All reasonable efforts are made to provide and maintain accurate information. All rates, fees, and terms are presented without guarantee and are subject to change pursuant to each Provider’s or affiliates discretion. There is never a guarantee you will be approved for credit or that upon approval you will qualify for the advertised rates, fees, or terms that were shown.
Be sure to speak with your representative about the actual term and rate you may qualify for based on your credit history and ability to repay the loan. Lenders may charge an origination fee generally around 1% of the amount sought. Be sure to ask up front about all fees, costs and terms associated with each loan product. Loan amounts of $1,000 up to $35,000 may be available through participating lenders or affiliates; however, your state, credit history, credit score, personal financial situation, and lender underwriting criteria can impact the amount, fees, terms and rates offered. In some cases, lenders may require that you have an account with them already and for a prescribed period of time in order to qualify for better rates on their personal loan products. Ask your representative for details.
Credit Card Advertiser Disclosure
The card offers that appear on this site are from companies or affiliate offers from which solvable may receive compensation. This compensation may impact how and where products appear on this site (including for example, the order in which they appear). solvable does not include all card companies or all card offers available in the marketplace.
Credit Card Providers determine the underwriting criteria necessary for approval. You should review each Provider’s terms and conditions to determine which card works for you and your personal financial situation. Information is provided by the Credit Card Providers and is not a guarantee of approval.
All credit card rates, fees, and terms are presented without guarantee and are subject to change pursuant to each Provider’s discretion. All reasonable efforts are made to provide and maintain accurate information. There is no guarantee you will be approved for credit or that upon approval you will qualify for the advertised rates, fees, or terms shown.
Any opinions, analyses, reviews or recommendations expressed in articles, marketing materials or otherwise are those of the author’s alone and/or solvable, and have not been reviewed, approved or otherwise endorsed by any Credit Card Provider.
See the online Provider’s credit card application for details about terms and conditions. Reasonable efforts are made to maintain accurate information. However all credit card information is presented without warranty. When you click on the “Apply Now” button, you can review the credit card terms and conditions on the provider’s website.
Business Loans Advertiser Disclosure
Business Loan offers that appear on this site are from companies or affiliates from which solvable may receive compensation. This compensation may impact how and where products appear on this site (including for example, the order in which they appear or whether a lender is “featured” on the site). solvable does not include all Business Loan companies or all types of offers available in the marketplace.
Business Loans are those loans that are for commercial use and any property and/or proceeds from the proposed request will be used by the requestor for commercial purpose only and not for any personal, family or household purposes.
Most of our Business Funding Partners or affiliates, do not require collateral for business loans; however, please note that it is possible to be offered another product by the lender depending on your needs and if the underwriting requirements dictate the same. Traditional bank and SBA loans generally are known for collateral requirements.
There is no one-size fits all business loan. Rather there are several types that will likely be offered and or discussed with you upon completing your request. Business Funding Partners determine the underwriting criteria necessary for approval, you should review each Partner’s terms and conditions to determine which business funding option works for your business’s financial situation. All reasonable efforts are made to provide and maintain accurate information. All rates, fees, and terms are presented without guarantee and are subject to change pursuant to each Partner’s discretion. There is never a guarantee your business will be approved for credit or that upon approval your business will qualify for the advertised rates, fees, or terms shown. Lender terms and conditions will apply and all products may not be available in all states. Ask your loan representative for details.
Student Loan Refinancing Advertiser Disclosure
Student loan offers that appear on this site are from companies or affiliates from which solvable may receive compensation. This compensation may impact how and where products appear on this site (including for example, the order in which they appear or whether a lender is “featured” on the site). solvable does not include all student loan companies or all types of offers available in the marketplace.
Pursuant to the contracts between solvable and the Partners or affiliates on its Network, solvable may also receive information from the Partner or affiliate regarding the status of your application including, but not limited to, the amount or disposition of your loan. Information specific to the Partner/affiliate’s use of your information will be found in their specific Privacy Policy.
Potential savings may vary based on the interest rates, balances and remaining repayment term of the loans you are seeking to refinance. Your overall repayment amount may be higher than the loans you are refinancing even if your monthly payments are lower. Variable rate options will fluctuate over the term of your loan with changes in the LIBOR (or other index utilized by the lender) rate, and will vary based on applicable terms and presence of a cosigner. Fixed interest rates may be based on applicable terms and presence of a co-signer. Additional terms and conditions, and rates are subject to change at any time without notice and may not be available in all states or for all types of current student loans. Such changes should only apply to applications taken after the effective date of change. Please note: Due to federal regulations, Lenders are required to provide every potential borrower with disclosure information before they apply for a private student loan. The Lender you select is required to provide you with an Application Disclosure and an Approval Disclosure within the application process before you accept the terms and conditions of your loan. solvable is not a lender or creditor, it does not offer, extend or alter credit terms. Only participating lenders can perform the full application and deliver the required disclosures, please ask your lender about rates, terms, fees, and potential discounts that may be available for each product.
Please Note:
Certain federal and private student loans may not be eligible for consolidation/refinance.
Certain consolidation/refinance plans may result in higher monthly payments or negative consequences (i.e. prepayment penalties).
Consolidation/refinance may lead to other negative results, such as loss of grace periods.
Loans in default generally cannot be consolidated until completion of a repayment trial plan so tell your lender if you are in default and determine relevant options (be wary of those asking for upfront fees as well)
Other options or programs may fit your needs (i.e. personal loan, debt consolidation and/or debt relief). Consult your financial and/or tax advisor prior to making any decisions.
Solvable is not a creditor as it does not offer, extend or alter credit; rather it is an online market lead generator that allows consumers to shop and compare rates, terms and costs associated with financial products such as mortgages, auto loans, personal loans, student loans, etc. solvable does not originate or fund any product it markets; rather it has a network of lenders or Partners/affiliates. You may choose to speak with one or more of these lenders or Partners/affiliates to determine what your actual terms and savings may be. Only a lender can provide you with a formal application for credit, your inquiry form here is merely an expression of interest and/or intent to obtain credit or assistance. You must discuss your actual credit situation and fill out the lender’s required documents prior to obtaining an extension of credit. Network lenders may not have the best or the lowest rates so you are encouraged to continue to shop and compare additional lenders, credit unions, local financial institutions, etc. to ensure you are truly getting your best deal for your situation.
You should contact your tax professional or other financial advisor to determine if you can actually realize savings by refinancing when it can extend the life of your current loan. You should ask the lender about all terms, rates, fees and costs associated with each product and if you will realize a net tangible benefit from the same. All initial estimated savings is done by trying to calculate what your rate may be; however, solvable does not have that information and cannot guarantee potential savings or that lenders will approve you for such product that would warrant those savings. Rates are not guaranteed and change daily. Lenders/Brokers/Dealers/Partners that perform the actual underwriting will have to determine if you meet their underwriting criteria which is unknown to solvable at the time of matching/offer/quote delivery. All amounts are estimates and examples only and do not represent an actual offer.
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