Legal Question in Tax Law in California

In 2009 I made a lot of money in capital gain and I owe over $40,000 to the IRS. I have been unemployed since December 2009, financially in verge of bankruptcy, and I cannot afford paying my taxes, In April I asked for tax extension till October 15, 2010.

Now, I used my capital gain to produce two low budget films which are not distributed yet. They are the only assets with equity. I currently have. Both my primary residence and the rental property their fair market values are less than the mortgages balance. Also my rental income is less than the mortgage payment. Can the IRS take films for payment? Is it better in my case to offer in compromise or installment agreement?


Asked on 8/07/10, 12:35 pm

1 Answer from Attorneys
Michael Stone Law Offices of Michael B. Stone Toll Free 1-855-USE-MIKE

First of all, make sure you are current in your tax filings. If IRS assesses taxes based on non-filing, the $40K could become nondischargeable in a bankruptcy. And speaking of bankruptcy, a Chapter 13 could result in lowering your principal and interest payments on the rental property.

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Answered on 8/12/10, 1:26 pm


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