{"id":5494,"date":"2019-09-04T10:21:56","date_gmt":"2019-09-04T10:21:56","guid":{"rendered":"https:\/\/mcintirelaw.com\/?p=5494"},"modified":"2023-05-05T00:45:14","modified_gmt":"2023-05-05T00:45:14","slug":"filing-bankruptcy-to-eliminate-tax-debt","status":"publish","type":"post","link":"https:\/\/mcintirelaw.com\/filing-bankruptcy-to-eliminate-tax-debt\/","title":{"rendered":"Filing Bankruptcy to Eliminate Tax Debt"},"content":{"rendered":"<div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-1 nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"--awb-border-radius-top-left:0px;--awb-border-radius-top-right:0px;--awb-border-radius-bottom-right:0px;--awb-border-radius-bottom-left:0px;--awb-flex-wrap:wrap;\" ><div class=\"fusion-builder-row fusion-row\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-0 fusion_builder_column_1_1 1_1 fusion-one-full fusion-column-first fusion-column-last\" style=\"--awb-bg-size:cover;\"><div class=\"fusion-column-wrapper fusion-column-has-shadow fusion-flex-column-wrapper-legacy\"><div class=\"fusion-text fusion-text-1\"><p>First and foremost, most taxes cannot be discharged in bankruptcy.<\/p>\n<p><img decoding=\"async\" class=\"alignright wp-image-5498 size-medium\" src=\"https:\/\/i0.wp.com\/mcintirelaw.com\/wp-content\/uploads\/2019\/09\/euro-870756_640.jpg?resize=300%2C200&#038;ssl=1\" alt=\"Tax Debt\" width=\"300\" height=\"200\" srcset=\"https:\/\/i0.wp.com\/mcintirelaw.com\/wp-content\/uploads\/2019\/09\/euro-870756_640.jpg?resize=200%2C133&amp;ssl=1 200w, https:\/\/i0.wp.com\/mcintirelaw.com\/wp-content\/uploads\/2019\/09\/euro-870756_640.jpg?resize=300%2C200&amp;ssl=1 300w, https:\/\/i0.wp.com\/mcintirelaw.com\/wp-content\/uploads\/2019\/09\/euro-870756_640.jpg?resize=400%2C266&amp;ssl=1 400w, https:\/\/i0.wp.com\/mcintirelaw.com\/wp-content\/uploads\/2019\/09\/euro-870756_640.jpg?resize=600%2C399&amp;ssl=1 600w, https:\/\/i0.wp.com\/mcintirelaw.com\/wp-content\/uploads\/2019\/09\/euro-870756_640.jpg?fit=640%2C426&amp;ssl=1 640w\" sizes=\"(max-width: 300px) 100vw, 300px\" data-recalc-dims=\"1\" \/>You may have been given false hopes by advertisements that offer a way to wipe out tax debts in bankruptcy. However, it is more complicated than perceived to be. Most tax debts can\u2019t be eliminated in bankruptcy &#8212; the fact is, you are still obligated to pay for them at the end of a Chapter 7 bankruptcy case, or you&#8217;ll have to repay them in full in a Chapter 13 bankruptcy repayment plan.<\/p>\n<p>Do not be discouraged, though. There is a reprieve for your tax debt woes, if and only if your debts are eligible for a Chapter 7 bankruptcy discharge.<\/p>\n<h3 data-fontsize=\"22\" data-lineheight=\"36.74px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:22; line-height: 1.67; --minFontSize:22;\"><span class=\"ez-toc-section\" id=\"Conditions_to_Discharge_a_Tax_Debt\"><\/span><strong>Conditions to Discharge a Tax Debt<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3><div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<label for=\"ez-toc-cssicon-toggle-item-66299d3b769c5\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-66299d3b769c5\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/mcintirelaw.com\/filing-bankruptcy-to-eliminate-tax-debt\/#Conditions_to_Discharge_a_Tax_Debt\" title=\"Conditions to Discharge a Tax Debt\">Conditions to Discharge a Tax Debt<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/mcintirelaw.com\/filing-bankruptcy-to-eliminate-tax-debt\/#Word_of_Caution\" title=\"Word of Caution\">Word of Caution<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/mcintirelaw.com\/filing-bankruptcy-to-eliminate-tax-debt\/#Contact_a_New_Martinsville_Bankruptcy_Attorney_for_Help\" title=\"Contact a New Martinsville Bankruptcy Attorney for Help\">Contact a New Martinsville Bankruptcy Attorney for Help<\/a><\/li><\/ul><\/nav><\/div>\n\n<p>Your debts for federal income taxes can be wiped out in a <a href=\"https:\/\/mcintirelaw.com\/west-virginia-chapter-7-bankruptcy-attorney\/\"><u>Chapter 7 bankruptcy<\/u><\/a> if the following conditions are met:<\/p>\n<ul>\n<li>\n<h4 data-fontsize=\"22\" data-lineheight=\"31.46px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:22; line-height: 1.43; --minFontSize:22;\">The tax debt is income tax debt.<\/h4>\n<\/li>\n<\/ul>\n<p>You may only discharge income taxes in bankruptcy.  Taxes other than income, such as payroll taxes or fraud penalties, can never be eliminated in bankruptcy. On the other hand, it may be good to know that any interest accrued on dischargeable tax debt may be wiped out, and penalties are dischargeable even if the tax debt is not.<\/p>\n<ul>\n<li>\n<h4 data-fontsize=\"22\" data-lineheight=\"31.46px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:22; line-height: 1.43; --minFontSize:22;\">The tax debt is at least three years old.<\/h4>\n<\/li>\n<\/ul>\n<p>In order for the tax debt to be dischargeable, the tax return must have been originally due at least three years before you filed for bankruptcy. This date includes any extensions.<\/p>\n<ul>\n<li>\n<h4 data-fontsize=\"22\" data-lineheight=\"31.46px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:22; line-height: 1.43; --minFontSize:22;\">There is no fraud or willful evasion.<\/h4>\n<\/li>\n<\/ul>\n<p>The tax return filed must not have been fraudulent or you must not have willfully evaded paying your taxes. If you filed a fraudulent tax return, such as using a false Social Security number on your tax return, bankruptcy cannot help.  Willful evasion is deliberately reporting less income than what was earned or deducting fictitious expenses and will also cost you the discharge of your income tax debt.<\/p>\n<ul>\n<li>\n<h4 data-fontsize=\"22\" data-lineheight=\"31.46px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:22; line-height: 1.43; --minFontSize:22;\">You pass the \u201c240-day rule\u201d<\/h4>\n<p>The income tax debt must have been assessed at least 240 days prior to filing bankruptcy. However, if the taxing authority was prohibited from making an assessment (e.g. previous bankruptcy filing or offer in compromise), then the time limit may be extended.<\/p>\n<\/li>\n<li>\n<h4 data-fontsize=\"22\" data-lineheight=\"31.46px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:22; line-height: 1.43; --minFontSize:22;\">The tax return was filed at least two years ago.<\/h4>\n<\/li>\n<\/ul>\n<p>You must have filed a tax return for the debt you wish to discharge at least two years before filing for bankruptcy.  The date the return was filed is the measuring date.<\/p>\n<p>If your tax debt meets the above conditions and you file for Chapter 7 bankruptcy,  you are eligible for a complete discharge of the debt. On the other hand, under <a href=\"https:\/\/mcintirelaw.com\/west-virginia-chapter-13-bankruptcy-lawyer\/\"><u>Chapter 13 bankruptcy,<\/u><\/a> if your tax debt qualifies, you will be required to pay back some or all of the tax debt, relative to your income and assets, through a repayment plan.<\/p>\n<h3 data-fontsize=\"22\" data-lineheight=\"36.74px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:22; line-height: 1.67; --minFontSize:22;\"><span class=\"ez-toc-section\" id=\"Word_of_Caution\"><\/span>Word of Caution<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>You can&#8217;t wipe out a federal tax lien. If your taxes are eligible for discharge in a Chapter 7 bankruptcy case, you must be aware that your tax liens recorded prior to a bankruptcy filing will not be discharged. Although a Chapter 7 bankruptcy will wipe out your personal obligation to pay the debt and prevent the IRS from going after your bank account or wages, the tax lien on your property which was recorded before you filed will still be in place. This means you are obligated to pay the tax lien so that you can sell the property.<\/p>\n<h2 data-fontsize=\"34\" data-lineheight=\"41.14px\" class=\"fusion-responsive-typography-calculated\" style=\"--fontSize:34; line-height: 1.21;\"><span class=\"ez-toc-section\" id=\"Contact_a_New_Martinsville_Bankruptcy_Attorney_for_Help\"><\/span>Contact a New Martinsville Bankruptcy Attorney for Help<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>If you, or anyone you know, have any tax debt, you should get in touch with our experienced <a href=\"https:\/\/mcintirelaw.com\"><u>West Virginia bankruptcy lawyer<\/u><\/a> right away. We may be able to advise you on the best legal remedy for your tax problems. Call us now at Thomas E. McIntire and Associates, L.C.<\/p>\n<\/div><div class=\"fusion-clearfix\"><\/div><\/div><\/div><\/div><\/div>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":2,"featured_media":5497,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[2072],"tags":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/i0.wp.com\/mcintirelaw.com\/wp-content\/uploads\/2019\/09\/document-3205407_640.jpg?fit=640%2C571&ssl=1","_links":{"self":[{"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/posts\/5494"}],"collection":[{"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/comments?post=5494"}],"version-history":[{"count":1,"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/posts\/5494\/revisions"}],"predecessor-version":[{"id":6541,"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/posts\/5494\/revisions\/6541"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/media\/5497"}],"wp:attachment":[{"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/media?parent=5494"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/categories?post=5494"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mcintirelaw.com\/wp-json\/wp\/v2\/tags?post=5494"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}