The U.S. Bankruptcy Court recently considered whether amounts withheld from wages in excess of the amount of the income tax liability owed is a refund of tax or a refund of wages. The case is In re Crutch, No. 15-44523-cec. (E.D.N.Y. 2017). The case is a reminder to those taxpayers who are considering bankruptcy that… Continue reading Does Withholding on Wages Convert the Wages to a Tax?
Category: IRS Debts
About IRS Debts & Unpaid Taxes
The IRS is authorized to collect unpaid tax debts. It has tools at its disposal to do so.
If you need to know more about the IRS’s collection function, you can read about the IRS collection function here. If you want to know more about how the IRS goes about collecting unpaid taxes, you can read about the tax collection options here.
This page covers recent cases, rulings, and guidance for IRS debts and collections. Scroll down to read the articles.
If you need help dealing with a tax debt or IRS collection matter, please schedule an appointment with our tax attorneys online. You can also call us at (713) 909-4906.
Transferring Property Owned by Taxpayer With Unpaid Taxes
Buyers have to be careful when purchasing property subject to an IRS lien. The recent United States v. Urioste, No. 4:15-CV-1787-VEH (N.D. Ala 2017) considered the situation where a business purchased and improved real estate that was encumbered by an IRS tax lien. Facts & Procedural History The case relates to the tax liabilities of Mr.… Continue reading Transferring Property Owned by Taxpayer With Unpaid Taxes
Taxpayer Retains Right to Tax Refund Claims Despite Bankruptcy Discharge
The bankruptcy-tax rules can present a number of opportunities. In Martin v. United States, Case No. 3:13-CV-03130 (C.D. Ill 2017), the court concludes that the taxpayers retained the right to sue the IRS for substantial tax refunds for taxes that were overpaid prior to their bankruptcy, despite having discharged their debts in bankruptcy. Bankruptcy &… Continue reading Taxpayer Retains Right to Tax Refund Claims Despite Bankruptcy Discharge
Continuation Theory: Collecting Taxes Owed by Prior Business
If a business has or expects to have a significant debt, it may transfer its assets and/or operations to a new business entity to try to avoid the debt. There are a number of non-tax cases where the courts have addressed this. The courts generally apply a “continuation” theory in these cases which asks whether… Continue reading Continuation Theory: Collecting Taxes Owed by Prior Business
Bankruptcy Court Rejects IRS Plan to Sell Residence
Bankruptcy can be a great way to get rid of older tax debts. The bankruptcy process is supposed to provide a fresh start. The In re Christensen, 15-29773, 15-29783 (2016 Bankr. D. Utah), case is an example where the IRS attempted to use the bankruptcy process not to provide a fresh start, but to collect… Continue reading Bankruptcy Court Rejects IRS Plan to Sell Residence
Court Invalidates Process to Challenge IRS Levy
If the IRS fails to mail a collection notice to the taxpayer or if it mails a required collection notice to a taxpayer using the wrong address, should the taxpayer be able to get a court ruling invalidating the IRS’s subsequent collection efforts? Congress added several notice requirements to help protect taxpayers from unlawful IRS… Continue reading Court Invalidates Process to Challenge IRS Levy
IRS Wage and Salary Levy Exemptions for 2017
The IRS recently issued Publication 1494, Tables for Figuring Amount Exempt From Levy on Wages, Salary, and Other Income – Forms 668-W(ACS), 668-W(c)(DO) and 668-W(ICS), for 2017. This publication provides the amount of wage and salary that are exempt from the IRS’s levy. The monthly wage and salary amounts for 2017 are as follows: Exemptions… Continue reading IRS Wage and Salary Levy Exemptions for 2017
No Damages for Emotional Distress for IRS Violations of Bankruptcy Law
When a private party violates the law, there are often consequences. This is especially true for the automatic stay that protects individuals in bankruptcy from collections actions during the bankruptcy proceeding. In Hunsaker v. United States, Case No. 6:16-cv-00386-MC, the Ninth Circuit Court of Appeals concluded that the IRS’s repeated violations of these laws does […]
The post No Damages for Emotional Distress for IRS Violations of Bankruptcy Law appeared first on Houston Tax Attorney: Texas Lawyer.
No Damages for Emotional Distress for IRS Violations of Bankruptcy Law
When a private party violates the law, there are often consequences. This is especially true for the automatic stay that protects individuals in bankruptcy from collections actions during the bankruptcy proceeding. In Hunsaker v. United States, Case No. 6:16-cv-00386-MC, the Ninth Circuit Court of Appeals concluded that the IRS’s repeated violations of these laws does… Continue reading No Damages for Emotional Distress for IRS Violations of Bankruptcy Law
How Do You Prove You Mailed a Tax Return to the IRS?
In In Re McGrew, No. 13-00149, the U.S. Bankruptcy Court for the Northern District of Iowa addressed a dispute as to whether the taxpayer had actually filed her tax return with the IRS. The taxpayer said she did; the IRS said she did not. This is a very common and important issue that taxpayers often […]
The post How Do You Prove You Mailed a Tax Return to the IRS? appeared first on Houston Tax Attorney: Texas Lawyer.