Hackensack, NJ asked in Tax Law for New Jersey

Q: In may of 2015 a Federal Trustee in Newark discharged my indebtedness by way of a Chapter13 Bankruptcy which included

Monies owed to the Internal Revenue Service According to IRS I owe $5,000 for year 2012 on January 22, 2020 I will be 65 years old . They take a percentage of my partial social security. At age 65 are they still allowed to collect arrearages and what is the procedure to stop this payment

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1 Lawyer Answer
D. Mathew Blackburn
D. Mathew Blackburn
Answered
  • Tax Law Lawyer
  • Englewood, CO

A: 2012 taxes would not be discharged in a 2015 bankruptcy. That return would have been due 4.15.13 and the three year period for discharging income tax would not have passed until 4.15.2016. Also, the IRS is a preferred creditor in a 13.

If you want them to stop the SS levy you have to setup an installment agreement, pay off the balance, prove the levy creates an economic hardship, or the collection period expires which should be somewhere around April 2023 assuming the CSED hasn't been paused, which it almost certainly has. You'd have to pull the transcripts to find out.

The IRS does this quite frequently and it is legal.

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