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PDtax, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 4521
Experience:  35 years tax experience, including four years at a Big 4 firm.
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To currently service my unsecured debt requires about

Customer Question

To currently service my unsecured debt requires about 3000.00 monthly. A total amount owed of approx. $70K. What effect does my tax free VA disability and SS benefits have?
Submitted: 1 year ago.
Category: Tax
Customer: replied 1 year ago.
I was recently audited by the IRS and told I owe 24K which I cannot pay. What are my options?
Expert:  PDtax replied 1 year ago.

Hi from Just Answer. I'm PDtax, and can assist.

Expert:  PDtax replied 1 year ago.

IRS tax debts can be collected via levy from regular social security benefits. VA and Social Security disability benefits are exempt from collection.

Additionally, credit card debts can't collect via levy from your benefits either.

Expert:  PDtax replied 1 year ago.

That does not mean that your creditors couldn't try to collect from your bank account, but IRS policy is not to do this. Credit card collectors don't have that kind of ethical stance.

Expert:  PDtax replied 1 year ago.

If it was me, I would consider a bankruptcy, which would discharge all of the credit card debt of $70K, and leave the IRS tax debt which they will not pursue.

It would remove the $3K per month of payments immediately.

Expert:  PDtax replied 1 year ago.

Asking a bankruptcy attorney to review your case is the next recommended step.

There are other settlement options, but all will cost much more than the fee for bankruptcy filing.

Thanks for asking at Just Answer. Positive feedback is appreciated. I'm PDtax.