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20 Year Old Considering Personal Bankruptcy
A reader asks: I messed up big time but I’ve learned a lot of lessons. I earned just a hair shy of $200,000 in my first year as a real estate agent at 20 years old. I was way too immature to have that kind of money, and blew most of it without saving. I invested my tax savings in growing my team which I thought would have been an easy pay back. Lost it all. No worries though just sell more houses. Depression strikes, mother gets very sick, I took on an expensive apartment and car. Not emotionally mature enough to handle these things like an adult yet. Hemorrhaging…
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Bankruptcy and surplus income (Video)
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My Husband Lied About $350,000 of CRA Debt. What Now?
A READER ASKS: Hello, we are 37 F+M married in Ontario for 17 years. Teenage kids. I make $70k in a government job with pension. He owns a contracting business that he opened about 15 years ago. We are well known. He is very successful with several great employees and we get a lot of business. After expenses and wages he might clear $100k. We have $109,000 in the bank combined, today. Through our entire relationship he has paid for everything in cash. Even multiple vehicles. Trips. He saves for what he wants and buys it. He has never had a credit card. All our finances are separate and we…
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Income taxes and the “honest but unfortunate debtor”
A bankrupt debtor who was ordered by the Court to pay $35,000 to the Canada Revenue Agency, which was the major creditor in her bankruptcy because of unpaid income taxes. At issue in this court case was whether the bankrupt in question was “an honest but unfortunate debtor”. Diewold (Re), 2018 SKQB 149 The Debtor—a 64 year old pensioner with no available surplus income—owes the Government of Canada a debt of $263,817.16 for personal income tax. The income tax debt makes up over 99% of the unsecured proven claims in the bankruptcy. The Canada Revenue Agency (“CRA”) opposed the Debtor’s bankruptcy discharge. The Trustee reported that the Debtor has assets…
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When you owe taxes to the Canada Revenue Agency
Yes, you owe income tax debt to the Taxman: sometimes it feel like you’re working for no one but him; especially if you are a high income earner. Therefore, it’s no surprise that income tax payers: Find ways to shelter their income. For many self-employed individuals, particularly some professionals, they do this by investing in tax shelters. However, when one’s tax shelters get disallowed by Canada Revenue Agency and a reassessment is issued, what can be done if the tax bill can’t be paid? Fail to remit income tax installments altogether, and end up with significant penalties and interest. When the assessment or reassessment comes in, some tax debtors are…