Hearts were handed a £450,000 tax bill on Wednesday, seriously threatening the club's future.
Wallace, who now plays for Rangers, experienced financial meltdown with the Ibrox club this summer and urged his former teammates to focus on getting results on the pitch.
"The main focus for the players will be on the match day, they will be preparing for the game. The best advice you can give them is to focus on the football. The events will hopefully unfold in a good way but the players have to focus on the game and represent themselves well on a Saturday," said the 25-year-old.
"I've got a lot of sympathy for what's going on there. I had a number of years at Hearts and got my football apprenticeship from them. There are a lot of players that I keep in touch and I've got a lot of good memories.
"It's not a great time for the club and I don't think it will be a great time for Scottish football if it's the worst case scenario for them. I spent many years there and I just for the sake of the club that they can keep going."
Hearts have warned that they could be out of business by as early as November 17 if they don't find sufficient investment.