Discharging Income Taxes And Student Loans In Bankruptcy

By Joseph Seagle If you are considering bankruptcy because of tax problems, then you will benefit from reading this article. Most people believe that taxes cannot be discharged in bankruptcy. This myth is not true. There are some technical rules that allow tax debts to be discharged in bankruptcy. If you meet each of the following requirements, then your taxes can be discharged. The first requirement is that you have filed a legitimate tax return for the year in question. Second, the tax return must have been filed at least two years before you filed for bankruptcy. Third, the tax return was due at least three years before you file for bankruptcy. Finally, the IRS has not assessed your liability for the taxes within 240 days before you filed for bankruptcy. The following example should make things more clear. Joe filed a tax return in Aug 2003 for the 2002 tax year. In Mar 2005, the IRS audits his 2002 tax return and assesses a tax debt of $10,000. In May 2006, Joe files for bankruptcy. The return was due on April 15, 2003, more than three years before Joe's filing date. The tax return was filed in Aug 2003, more than two years before Joe's filing date and the assessment date of Mar 2005 was more than 240 days before the filing date. These taxes can be discharged in bankruptcy. If you meet all of these requirements, your liability for the taxes should be discharged. Penalties on taxes that…

Read the rest of this entry

How to File Taxes Owed With Bankruptcy

By Tony Lu Having problems with taxes and debt is definitely not a good thing for anyone concerned, it brings an uncomfortable feeling to your life.Then you ask can you file taxes owed with bankruptcy, yes you can in some circumstances, but there is certain taxes you won't be able to. As filing taxes especially when filing for bankruptcy at the same time can be a daunting task it is a very good idea to get a tax or bankruptcy lawyer to help you through this process, a lawyer will be able to help you with the things you may know nothing about like the chapters of bankruptcy cases and especially for which one you should file, as some taxes won't be discharged he will also know if your type of tax has the chance to be discharged. He has to be in this type of work and know quite a lot about it. To know whether the tax debt you have is general unsecured or priority taxes is very important since even when you file for bankruptcy, taxes that is priority taxes will not be discharged and the debt will be yours to repay and it will be the full amount owed. If your decision is to file for a chapter 13 bankruptcy case, a certain percentage of the money owed will be billed to you this percentage range from 0-100. This means that the chapter case you file for will determine how much of your tax debt will…

Read the rest of this entry

Taxes and Bankruptcy

By Tommy Brown Bankruptcy is never an easy decision, and is often part of a scary and painful process. If you are considering bankruptcy, you need to be aware of the tax implications as well as whether bankruptcy would really be of help in your situation. In this article, we will talk about some of the limitations of bankrupting tax debt, and how taxes are assessed during bankruptcy. The first thing you might wonder is if your tax debt can be discharged in a bankruptcy. The answer is that it depends on the type of bankruptcy you file (Chapter 7, 11, or 13) as well as some factors pertaining to the debt itself. Before your tax debt can be discharged in any bankruptcy, it must meet all of certain criteria: The due date (plus any extensions that were filed) for your delinquent taxes must be at least three years ago. Any taxes that will be discharged must also have been filed on a return at least two years ago. There must also have been at least 240 days to pass since the IRS assessed the tax. Additionally, there must not be any fraud on your tax return or any sort of an attempt to evade taxes. Finally, no un-assessed or trust fund taxes can be discharged. A Chapter 7 bankruptcy can provide for the liquidation of your tax debt, but you must pass a means test. Your income, for instance, must be below the state median. Remember, tax is not…

Read the rest of this entry