Bankruptcy and Taxes
Bankruptcy and Taxes
When it comes to bankruptcy and taxes, there can be several serious things
that you are going to want to think about. If you are going to file for
bankruptcy, you are going to want to make sure that you are doing
everything you can to save yourself as much trouble, money, and time as you
can.
You should know that any income tax debts might be eligible for being taken
care of under Chapter 7 or chapter 13. If you are willing to file for
bankruptcy, this is one of five ways that you can get out of tax debt.
However, you should remember that in order to get your taxes discharged by
filing for bankruptcy, you are going to have to meet certain requirements,
so you should make sure you meet them before you file for bankruptcy to get
out of tax debt.
If you file for Chapter 7, you are going to be able to get fully discharged
of the debts that are allowable. With Chapter 13, there will be a payment
plan that is required so that you can pay back some of your debts, and the
rest will be discharged. Remember that not all of the tax debt that you
might have is going to be discharged if you file for bankruptcy. You have
to meet five criteria in order to get your taxes taken care of.
These five criteria that you need to meet in order to get your tax debt
discharged when you file for bankruptcy are all important. The first is
that the date that the tax return was due was at least three years ago. The
second is that the tax return had been filed at least two years ago. The
third is that the tax assessment is at least 240 days old. The fourth is
that the tax return cannot have been fraudulent. And the fifth is that you
are not guild of tax evasion. If you can meet all of these criteria, you
are going to be able to most likely get your tax debt discharged when you
file for bankruptcy.
Remember that filing for bankruptcy carries its own consequences,
especially on your credit. You should not file for bankruptcy just to be
able to get out of paying your tax debt, because it is going to do much
more harm than good in the long run when it comes to the damage done to
your credit. Only file if you have no other option and if you’ve been told
that it is your best chance of beginning to rebuild your life.
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