IRS Tax Discharge

When it comes to bankruptcy, there are limited situations in which outstanding tax liabilities may be discharged.  There are very complex rules in relation to discharging tax debt through a bankruptcy filing, whether it is Chapter 7 or Chapter 13 bankruptcy, but by discussing the specifics of your case with a qualified tax professional or bankruptcy attorney, you can get a better indication about whether you will be able to receive an IRS tax discharge in conjunction with your bankruptcy filing.

Discharging tax debt refers to the opportunity to eliminate your responsibility for repaying all or a portion of your tax debt based on specific criteria set forth in your bankruptcy case.  At a minimum, the following must be met, although even if all aspects of the terms set forth below have been met, there is no guarantee that you will be able to have your tax debt discharged with bankruptcy.

Here are the basic stipulations that will be considered to determine if there is even a possibility of IRS tax discharge along with bankruptcy:

• Tax returns must have been filed at least two years or more prior to the date of bankruptcy filing.
• It has been three years or more since the tax returns were last due to be filed (this includes any extensions) prior to the date of bankruptcy filing.
• Tax returns were filed on a timely basis.
• The tax liability was not assessable at the time of the bankruptcy filing and was assessed at least 240 days prior to filing of the bankruptcy petition.
• The tax was unsecured.
• The tax liability was not due to a fraudulent tax return and the taxpayer did not attempt to evade the tax.
• The liability is not due on a Trust Fund Tax.

Since each case of bankruptcy involving outstanding tax liability is unique, it is best to discuss your individual case with a qualified tax professional who can help determine if you will be able to have your IRS taxes discharged in conjunction with a bankruptcy filing.

Are You Filing Bankruptcy And You Have Outstanding Tax Debt?  Contact Us Today!

If you are considering bankruptcy or are in the process of bankruptcy filing and would like more information about whether your IRS tax debt can be discharged through bankruptcy, call People’s Tax Relief for a free, no-obligation tax consultation at 866-788-8069 or fill out the form on the side of this page and one of our experienced tax specialists will contact you.  During this consultation, we will discuss the specifics of your situation and will provide you with additional information in relation to bankruptcy filing and IRS tax discharge.