Help please: Bankruptcy and saving my house
- Thread starter smileyface
- Start date
Hi
I am not sure of the thresholds, but it could be possible to enter into an agrangement to pay and avoid bankruptcy, an insolvency agreement maybe?
Okay debt is $320k... do you think the ATO would do a deal for $70k?
and a tax debt of $320,000 is extremely large. You would have had to earn close to $1mil to have a tax debt so big. The bankruptcy trustee may need to looking into your situation to see where all the money went. Transactions over the last 5 to 10 years could be looked at.
The Trustee in Bankrutpcy may call a meeting of creditors and the creditors may need to vote on certain things - such as accepting a payment of x cents in the dollar (money which you could get from friends) in exchange for you to avoid bankruptcy. I think things are decided on a majority vote of those creditors present.
You should have a good look at www.itsa.gov.au and also the bankruptcy Act - read the whole thing, or at least skim through it. http://www.austlii.edu.au/au/legis/cth/consol_act/ba1966142/
Even if it takes you 8 hours, it may be worth it as it could save you money.
How would a 2nd or 3rd job pay off a $300k debt? To pay off that kind of debt, you'd need to pretty much earn $600k.
Maybe you can be the CEO of 3 different banks
Well a $320K Personal Income Tax ATO debt suggest either many years of not paying tax, or a large income on which a lot of dodgy tax minimisation happened. How else do you accumulate so much.
So while not paying tax like the rest of us, he bought 2 properties, and somehow now he should be allowed to protect them, and wipe his hands clean via bankrutpsy. I don't think so.
Maybe arrange a payment plan with the ATO.
Yeah but maybe accounting is a better analogy. Like some accountants are not property experts, so rather than waste time trying to teach your accountant about property, find one that's already experienced in that specifically. So I guess I'm trying to find a (non dodgy) trustee that is already experienced in saving houses.
Not as simple as that. Yes I was late with some bills a long time ago when I earned a lot but the bills were large from a lack of 'dodgy tax minimisation'. Absolutely everything declared resulting in big bills. And have struggled for years to catch up with it with various payment plans but have never been able to get on top of them.
So now $70k equity is everything I own. So if I don't file for bankruptcy voluntarily, they are bound to force me into it sooner or later... the interest alone is like $700 a week and growing.
I know why it happened and am sure to avoid it in future. I don't want to through this again.
Thank you this is very helpful because I thought bankruptcy was set in stone once you appointed a trustee. I didn't realise a bankruptcy trustee was a person who could also help you avoid it.
Even at a $48% tax rate, I can't see how that much was accumulated without deliberately not paying tax. You call it "late" because the ATO eventually caught up with your tax dodge.
I personally don't have time tax cheats. We pay a combined tax bill of $70-75K/yr.
I don't believe you should be able to save your homes. Many others struggle to even get into property because they actually do the right thing.
Maybe check with Christopher Skase in Majorca on some accountant recommendations.
Actually, I am not sure if you could avoid it in this situation. A trustee is appointed once you enter bankruptcy. I think what would happen is you would be, or could be, released from Bankruptcy early. You would still have the stigma of having been bankrupt though.
No, I call it late because I always fully intended to pay it, but was unable to on time as it was tied up. What it was tied up in went south unfortunately and ceases to exist. It's not a 'dodge' to invest in the wrong business and end up losing everything. I didn't lose it all on purpose.
Me neither, which is why I always fully declare everything and work up huge bills as a consequence.
Your point is moot anyway as I'll never have $320k to pay them. So whether they force me into bankruptcy or I go voluntarily, what I have to pay them is $70k. So why shouldn't my wife be able to effectively switch places with me to have equity in property instead of cash in her bank account?
If you think of it that way, I'm not saving my houses at all, I'm losing my houses, and helping someone to get into property who would otherwise be unable to (she wouldn't qualify for a loan), and she'll be returning the favour by letting me live there
The fact that there's a stigma is a real shame I think. If there weren't such a stigma, there might be more people willing to share their personal and direct bankruptcy experiences with smiley and the rest of us here on a public forum for people to learn from.
Instead bankrupts stay silent, probably out of fear of the kind of judgmental posts we are seeing above.
I bet you the creditors they screwed don't feel the same way.
sure, but it's misplaced emotion. without the clean slate they would have been condemned forever and therefore the creditors no better off.
Even at a $48% tax rate, I can't see how that much was accumulated without deliberately not paying tax. You call it "late" because the ATO eventually caught up with your tax dodge.
I personally don't have time tax cheats. We pay a combined tax bill of $70-75K/yr.
I don't believe you should be able to save your homes. Many others struggle to even get into property because they actually do the right thing.
Maybe check with Christopher Skase in Majorca on some accountant recommendations.
Bluestorm,
Can't believe I'm actually agreeing with you.
Declaring bankruptcy is no longer a stigma for most people. They see it as a way out of paying their bills.
What about the creditors?..everyone else has to pay higher costs because of it.
Honesty.
Pay his debts until they are paid off.
The fact he is now doing his best to transfer properties, instead of using that 70k to pay off his debt...speaks volumes.
So many here are trying to assist him..hmmmm
Don't let it freak you out. By the end of 2012, you will have all converted to my views
People these days want to take excessive risks for quick gains and quick bucks (eg, the Storm Finance people), but are then not prepared to pay up when things turn sour, insteading take the easy option and declaring bankruptcy and leaving creditors out of pocket. Somebody pays eventually in the end.
So someone took excessive risks, then declared bankruptcy. Then took more excessive risks and just happened to get lucky this time and became a multimillionaire. It's not a badge of honour to me.
each to their own - I find rags to riches admirable.
lack of risk taking is part of the fundamental problem in this country. it's why we have sold out to foreign mining companies and speculate on real estate...nothin' much else to do. I reckon if you can make a million in business in this country you could make 20 in the US
lack of risk taking is part of the fundamental problem in this country. it's why we have sold out to foreign mining companies and speculate on real estate...nothin' much else to do. I reckon if you can make a million in business in this country you could make 20 in the US
