QUESTION
Can I discharge income taxes by filing for bankruptcy? How?
Asked on May 05th, 2015 on Bankruptcy - Michigan
More details to this question:
I am filing for chapter 7 bankruptcy. Will my personal income taxes be discharged?
10 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Taxes older than 3 years will be discharged
Answered on May 07th, 2015 at 4:16 AM
Deborah F. Bowinski
Most income taxes cannot be discharged in bankruptcy. If you owe old taxes some of them might be dischargeable, but only a careful analysis of the tax records and tax returns would tell you that information.
Answered on May 07th, 2015 at 1:25 AM
This tax stuff is a bit tricky. I would suggest you meet with an experienced BK lawyer to get your questions answered. The timing can also be tricky. You don't want to make a mistake here. It can be the difference between discharging the taxes, or being stuck with the tax liability plus interest & penalties. Any lawyer worth their weight in salt is going to charge you for the consultation. But it is money well spent!
Answered on May 06th, 2015 at 12:13 PM
2 Awards
You cannot discharge income taxes. However, if you timely filed a return but simply did not pay the tax when due, and if the tax is more than three years old then you may be able to discharge the taxes.
Answered on May 05th, 2015 at 6:04 PM
Yeah, it depends. Tell me what tax years were involved and whether the taxes were filed on time, so I can give you my best guess. No guarantees in Chapter 7. However, if you have tax that will not be eliminated in Chapter 7, you could pay it off without additional interest or penalties in a Chapter 13. When tax debt is over $20,000, I feel that can be an excellent choice.
Answered on May 05th, 2015 at 5:29 PM
Real Estate Attorney serving Florence, KY
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Linda S. Novakov & Associates, PLLC
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Generally, the answer is no - income tax liability is not dischargeable with some very limited exception.
Answered on May 05th, 2015 at 5:06 PM
You can discharge some taxes. They must be over three years from the filing date of current year, so 2011 or older and have to have been filed for at least two years.
Answered on May 05th, 2015 at 4:35 PM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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Income taxes may be discharged IF: they are for a year or years greater than 3 years before the past 15th April. That means if you filed today, you could not discharge the claim for income taxes for 2014, 2013 or 2012. You could discharge income tax claims for 2011 and earlier IF the claims are unsecured (i.e. no notice of tax lien has been filed), and you filed a good-faith tax return on time, or within any extension granted. It's best to have a lawyer advise and represent you in almost any court matter. Good Luck.
Answered on May 05th, 2015 at 4:34 PM
Debt Settlement Attorney serving Chicago, IL
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Law Offices of Daniel J. Winter
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The answer is a definite "it depends". Some taxes can be eliminated in bankruptcy and some cannot. There are complicated rules to review with an experienced bankruptcy attorney.
Answered on May 05th, 2015 at 4:11 PM
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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Usually not, which is not surprising as the government makes all the rules.
Answered on May 05th, 2015 at 3:58 PM