About Income Taxes
Counsel from a Denver Bankruptcy Lawyer
As a general proposition, older personal income taxes (more than 3 years old) can be discharged in Bankruptcy while newer income taxes (less than 3 years old) cannot. The dischargeibility of state and local taxes, such as sales and use taxes, will depend upon their true nature, i.e., whether they are excise or withholding taxes. The trust fund portion of payroll taxes is generally not dischargeable.
If you are experiencing tax problems, we can help you assess your situation to determine your best course of action. The bankruptcy attorneys at Roberson Law, LLC can provide you counsel during this time, helping you make the best choice for your future.
To determine whether or not you can discharge income taxes in Chapter 7, you will need to determine if:
- The tax return was due more than 3 years prior to the filing.
- The tax return has been on file for at least 2 years prior to the filing.
- The tax has been assessed for at least 240 prior to the filing.
- The tax is based on a fraudulent return.
- There was any willful tax evasion by the debtor.
In Chapter 13, income taxes can be discharged if the return was due more than 3 years prior to the filing, and was assessed at least 240 days prior to the filing. In some cases, the tax may be dischargeable even if not assessed prior to the filing.
If you have more questions about discharging your income taxes in bankruptcy, be sure to contact us today at (303) 893-0833.