Coming Clean

I share a lot of my life on this blog, and I’m always a little cautious about just how far I should go. I know that people that know me personally read my blog, so I try to be not too offensive and leave some of the most personal details of my life out, but I realized that doing this has caused a roadblock for the content of this blog.

Something happened about 3 weeks ago that has totally consumed my life, and I’ve been trying hard to not write about it, but by doing so, I haven’t been able to write with my usual passion and fervor, and you’ve noticed. For that, I apologize. So, it’s time to come clean. What’s the road block in my life? I’ve been sued for some debt I owe.

Some of you are not sitting there thinking, well that’s not bad. You might have been there and done that, but I’ve never been sued in my life. I pride myself on struggling through the whole debt thing and paying things down, but this one blindsided me.

despair

If you’ve followed my blog from the beginning, then you know that I got into this mess from a business that failed. More than half of my debt is from that business, but this one came out of left field. You see, I apparently still owed the state some money in conjunction with the close of the business and they must have been sending notifications to the old business address and not to me. Long story short, they got a default judgment against me (meaning that I didn’t show up to court) for taxes to the tune of $10K. Now, I would have shown up, had I known about it, but I didn’t! The only reason why I even know about this judgment is because I had a free trial membership to a credit monitoring service and this popped up on my credit so they notified me. Now, here’s the thing. I didn’t even owe $10K originally. I probably owed closer to $4K-$5K.

 

I can’t tell you how negatively this affected me. The day that I found out, I attempted to go to sleep only to wake up about 2 hours after going to bed with this debt weighing me down into the mattress. I never did go bad to sleep, but instead laid there all night thinking of how in the hell I was going to get $10K to pay these people off before they garnished my wages or put a lien on my property and come get my car or whatever.

I can honestly say that everyone had a limit to how much stress they can take, and that day, I hit the wall going 100 miles per hour. Very irrational thoughts as to how to make the money kept swirling in my brain and I know that had I been in the right frame of mind, I would never have had those thoughts. I finally, mentally and physically just broke down sobbing to a very trusted coworker. She understood the mental state that I was in based on her own financial troubles.

At some point I realized that I needed to act. I called up a bunch of attorneys to see if I could get it overturned since I was never notified. The fees that they would charge would have amounted to about $3,000 – money which I don’t have. I finally spoke to an attorney over the phone that sensed that I was in a panic. He said that I could pretty much handle this on my own by negotiating with the state. I could call them and try to have then accept some the original amount due, but he doubted that they would do that since my state needs whatever money they can get. He also suggested that I not keep any money in my bank accounts and to open new ones, probably under some else’s name (gotta love lawyers) until I could either set up some payment plan or resolve everything with the state. Finally, with regard to the hit my credit had taken, he said that having a tax lien wasn’t as bad as having a lien from a creditor like a credit card company, and that since I had never had a history of these issues anyone viewing my credit would take it into consideration. His fee would have been $2,500 but he said that he did not recommend an attorney when I could use that money towards the debt. An honest lawyer!

So, where am I now? Bank accounts empty. Still trying to negotiate with the state and waiting for some paperwork. Thinking about this every single day is blocking my creativity. What did happen though, was that I tried to compartmentalize this part of my life into a very small box that will not be the center of my universe. I’ve also realized that I’m going to have setbacks, but I won’t let this break me. I’m a New Yorker.

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18 Responses to Coming Clean

  1. Icebergking says:

    I am not dressing like a cow dammit!

  2. Bob The Builder says:

    I’m doing it for my free meal. It’s a recession!

  3. Wow, that sounds like a tough situation. I’m really surprised that you found an honest lawyer. I hope that everything works out with your negotiations with the state.

    • Sandy says:

      I had expected each lawyer to just tell me to hire them, but this guy was very honest and up front. I saved him name and number in case i ever do need a lawyer. He’s earned at least that much.

  4. The Saved Quarter says:

    Oh, what a stressful situation! I can relate to the feeling of being pinned down, unable to sleep, by the money worries. It’s not a feeling I’d wish on anyone! I hope you’re able to negotiate around this and get yourself on solid footing soon.

    • Sandy says:

      At first I thought that my chest was going to cave in as I was laying there in the dark, then I realized that I was probably having a panic attack. It was crushing and I never plan to feel like that again.

  5. Jeff Kosola says:

    I’m glad you shared your thoughts and feelings. It’s never fun to have it build up inside you. Using your blog is a great way to get outside support and to keep your wits about you. I share everything on my blog as well, so I know what’s it’s like to worry about what you say. Good luck and keep your head!!

  6. Kellen says:

    I think it sounds like a perfectly awful, understandable situation. I was just reading your review of your 2010 goals – saying that you’re going to pay the full $10k?

  7. Sam says:

    Wow, fight on! I’m sure when the state gets to it, it won be as bad as what they originally wanted.

    What kind of irrational things were you thinking about to make $10k?

  8. Ginger says:

    What is the status of this experience with the whole tax mess? Have a link to an update? :) I hope by this point you have gotten some relief in many ways.

    No one told us that as bloggers we are at a 50% tax rate either. Add expenses to keep a blog running if you are self-hosted, some of the goodies we all tend to love like a few nice graphics and in the end most of us don’t make a whole lot.

    I wish you well! I found you via ProBlogger!

    Ginger
    AttentionDealShoppers.com

  9. Hi Sandy,

    I’m glad to read you’re finished paying this off. You nailed that pretty quickly. Great ending to a tough situation! We had a similar situation…took us a year to knock out $20K. Struggle, but sooooo glad that’s behind us :)

  10. kh says:

    Wow. I just found your blog thru someone else’s links and read back to this post. Deja vu. Last September (just like you) I found out about a back tax bill for around $10k from my old business as well. I was in almost the exact same situation – the IRS was sending the notifications to my old business address; one that I hadn’t used in almost 6 years, so I never got the notifications. Except I didn’t luck out and find out about it from a random credit check; I found out when my paycheck was garnished and they left me $172 a week to live on (in a major metro area).

    I also contacted a bunch of attorneys and got quoted $2k, $3k, and even $5k to deal with it. I got online and found the information about the Taxpayer Advocate department and wound up negotiating the debt myself.

    But yeah, scary and stressful and all of that. I’m glad you got it resolved!

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