My boyfriend owes several past years of business taxes. He recently spoke with an attorney to discuss bankruptcy and foreclosure and was told that he should wait to move forward until November 2012, when $29K due to IRS filed in November 2010 will no longer be considered due. How can this be true? Why wouldn't everyone just not pay taxes if they shluff out of the system?

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Originally Posted by s29jones

My boyfriend owes several past years of business taxes. He recently spoke with an attorney to discuss bankruptcy and foreclosure and was told that he should wait to move forward until November 2012, when $29K due to IRS filed in November 2010 will no longer be considered due. How can this be true? Why wouldn't everyone just not pay taxes if they shluff out of the system?

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That attorney is either #1. An Idiot or #2. he (boyfriend) misunderstood what he (attorney) said.

What you believe is true... they can come ofter those taxes for years to come... there is no 2 year and you are off scott free statute of limitations.

I can foresee him getting in SERIOUS trouble in the near future if he doesn't find a new, competent Attorney soon. Someone that didn't get their Law Degree out of a Cracker-Jack box.

You either misunderstood what the attorney was saying, or he is giving you bad advice. If the IRS is owed money, they will call is "owed" for long past 2 years. I don't know how long, but I know for sure that it is far more than 2 years.

I suspect this is a communication issue.

While the taxes will still be owed, once they hit a certain time limit of being past due, they ARE eligible to be discharged under a bankruptcy proceeding. I do NOT know the particulars on this, since I am NOT a bankruptcy attorney, but I suspect that is the intent of the attorney cited above.

Generally the IRS will try to collect taxes for ten years from the date the tax was assessed. However, taxes can be cleared in bankruptcy if some specific rules are met. One of those rules is that the returns have to have been filed two years before the bankruptcy petition. This is where the two years comes in. However, that is not the only rule to be met before the tax is "no longer be considered due". Your boyfriend did the best thing in consulting with a professional as this is a complicated area.

Yes, there is a real misunderstanding of the statements made, The way you understand it, and the real law is not the same.

They will often find and come after taxes much more than 2 years late.