Bankrupty and Taxes
Should you file for bankruptcy? Talk to us first.
You may be under enormous pressure from the IRS and considering filing bankruptcy to settle it all. Did you know…
Yes, you may be able to discharge debts for some federal income taxes under a Chapter 7 bankruptcy if you meet certain criteria. However, it is important to note that bankruptcy cannot discharge a federal tax lien after it has been placed on a property. Since tax liens are filed fairly early on in the process of the IRS attempting to collect your debt you are likely to have a tax lien. If a federal tax lien is placed on your property prior to you filing for bankruptcy you will ultimately still have to pay off the tax debt when selling the property even if your tax debt was discharged in bankruptcy. Additionally, bankruptcy may not discharge certain taxes. Income taxes must meet certain criteria involving the timing of when your return was due to be filed; when your return was actually filed; and when the tax was ultimately assessed.
It is important to plan and structure your overall debt resolution plan carefully with a knowledgeable, experienced tax resolution specialist to get the best deal possible for your overall situation. IRS Hostage Negotiators can provide a careful review of what the IRS has recorded in your tax records. This is vital to determining which rules apply to the income taxes you wish to discharge under bankruptcy. Still, other taxes may not qualify including, payroll, sales, and some other income and property taxes depending on certain other conditions. Start working with IRS Hostage Negotiators now so we can help you determine if bankruptcy is really the right choice.