It’s a myth that a bankruptcy filing cannot provide relief from an individual’s income tax liabilities. In fact, a chapter 7 bankruptcy can greatly assist with income tax problems in certain limited situations.
Let’s explore below how a bankruptcy can discharge (wipe out) personal income tax liabilities in the following scenarios and situations:
For our readers in Michigan: The same above information applies to income taxes which you may owe to the State of Michigan or the City of Detroit.
Whether or not filing bankruptcy can help you with your particular tax situation must be analyzed by a very experienced bankruptcy attorney.
As a good next step, you will want to assemble the proper tax information for your bankruptcy attorney to review. Visit the link below to the official IRS website where you can request a tax account transcript for the specific years for which you have income tax liabilities:
It is very important to understand that there are different kinds of tax transcripts and the particular type that will be most useful when consulting with a bankruptcy attorney is a tax account transcript and NOT a tax return transcript.
A tax account transcript can provide important information for your bankruptcy attorney to review and see whether or not you are a candidate for protection from the IRS.
Bankruptcy can be a valuable tool for individuals and businesses looking to get out from under insurmountable debt to get a fresh start. The Bankruptcy Code consists of five distinct types of bankruptcy for individuals and businesses for debts owed in the United States (the sixth, Chapter 9, is only available to municipalities to reorganize […]
Many people in need of legal advice concerning financial problems and the possibility of filing bankruptcy understandably want to get it done as cheaply and efficiently as possible. In today’s world of easy internet access, many of us take it upon ourselves to research answers online to become educated on the benefits and pitfalls of […]