Being in debt is not pleasant…and tax debt is no different. While filing for bankruptcy may help you with most debts, it is not always the best solution for dealing with IRS debts. One of the most popular ways for dealing with IRS debts is by settling tax debts through the Offer in Compromise Program.
If you’re having tax problems
Looming income tax debt can be daunting and create financial stress. What are your best options to resolve the debt and would filing bankruptcy help? Here is the breakdown of how tax debt is handled in the two main types of consumer bankruptcy.
Bankruptcy and the IRS Bankruptcy may temporarily delay collection activities by the IRS. However, some types of tax debt are not dischargeable in bankruptcy, so the IRS may be able to resume their collection efforts once the automatic stay is lifted.