Jamie Carragher faces being declared bankrupt over an unpaid tax bill which is reported to be in the region of £700,000 to £800,000.
HMRC filed a petition at the High Court in London on Wednesday.
A spokesperson for Carragher told Daily Mail Sport: 'This is a private tax matter that should have been resolved sooner, and the appropriate steps are being taken today to settle it.
'It is understood that the matter will not proceed any further and will be resolved imminently.'
A spokesperson for HMRC told Daily Mail Sport: 'We take a supportive approach to dealing with customers who have tax debts and do everything we can to help those who engage with us to get out of debt, such as offering instalment plans. We only petition for bankruptcy as a last resort.'
HMRC added that it does not comment on individual cases. The BBC reported that the bill is around £700,000 to £800,000.
Jamie Carragher, pictured with his wife Nicola, faces being declared bankrupt
On Companies House, the 48-year-old is listed as a director at four firms and as a LLP Member for another.
Carragher is currently a regular pundit on the Premier League for Sky Sports and on the Champions League for US network CBS Sports.
He is also a regular on the Stick to Football podcast, run by Gary Neville's media business The Overlap.
Carragher played for Liverpool throughout his club career, making 737 appearances and only scoring four goals – though he almost added a remarkable long-range fifth in his final game against QPR in 2013.
The centre-back played every second of Liverpool's iconic Champions League final comeback against AC Milan and is regarded as a club legend. His annual salary with the Reds is believed to have peaked at around £5million per year.
He also tallied 38 caps for England and went to the 2004 Euros as well as the 2006 and 2010 World Cups.
The Bootle-born personality is the founder of the 23 Foundation, an organisation aiming to help young people in Merseyside, and is a co-founder of Football For Change, which helps to tackle child poverty through education, sport and training.
He is married to his wife of 21 years, Nicola, and together they have two children: James, 23, who plays as a defender for League One club Wigan Athletic, and actress and model Mia, 22.
Jamie and Nicola got married in 2005 at a 17th-century stately home on the Staffordshire-Shropshire border after their initial dream venue, Allerton Castle in Yorkshire, was partially destroyed by a fire.
Carragher has been married to his wife Nicola for 21 years and they have been together for 30
'We’ve been together for the best part of 30 years now and I’m really proud of that. It doesn’t always happen in football or if you’ve got a bit of a profile,' Carragher told The Times earlier this year.
'When I was a young lad I used to look at couples who had been together for years and think that would never be me. But here we are. Nicola is not just my wife, she’s also my best mate.
'I’ll admit I’ve been dead lucky; my professional life was full of amazing moments: playing for England, Liverpool’s 2001 treble, that amazing comeback in the 2005 Champions League final - from absolute despair to absolute joy, the stuff you dream of when you’re a kid.
'But it doesn’t matter what I’ve achieved or what you’re going to offer me, there is only one person I want by my side.'
Carragher also joined sixth-tier Merseyside club Marine in May to help out in an advisory capacity.
‘Marine is a proper community football club with good people involved and a clear vision for where it wants to go,’ said Carragher in a statement.
‘I’ve enjoyed watching the progress the club has made over recent years and I’m pleased to be able to support the club in an advisory capacity going forward.’
Carragher has built a successful career as a pundit but that wasn't always a guarantee - particularly after he accidentally spat in a 14-year-old girl's face, having been taunted by her father, in 2018.
Carragher's son, James, 23, plays as a defender for Wigan Athletic in League One
His daughter, Mia Carragher, 22, is an actress and model who has performed in The Hunger Games On Stage
He admitted that the controversy 'knocked me for six months' after being suspended as a pundit by Sky Sports, with the Liverpool legend revealing he saw a psychologist to help him deal with the episode.
There were widespread calls for Carragher to be sacked after his spit hit the 14-year-old girl, but he left his role at Sky briefly before returning six months later having reached out to the two involved to apologise.
He said he 'wasn't himself' during his period out of work and ended up visiting former Liverpool and England psychologist Steve Peters.
'Coming home from Old Trafford and then when I lost my job at Sky - I'm someone who's quite on the front foot, if someone attacks me,' he told Gary Neville on his YouTube show The Overlap.
'But that knocked me for six months. For a good six months I wasn't myself. I'd get up in the morning and just have that pain in my stomach, oh that did happen.
'I went to see Steve Peters after it. I felt really bad, embarrassed, my family, my Mum or Dad. And the kids. I remember getting back to the house that night when I'd been at Sky. I haven't seen the kids, they're at school, and you just get back and we all sat together and it was tough.
'Even though we're in the public eye, we're not the royals, [David] Beckham, big stars. You read them on the front page. When it's you, everywhere I went it felt like people were looking at me.'