September 20, 2014

While some people may be struggling with credit card debt or medical bill-related debt, for others, the real problem may be overcoming significant tax debt. Unlike credit card or medical debts, however, tax debt is not always dischargeable through bankruptcy, as the specific nature of the debt, as well as when it was incurred will be critical to determining whether it can be discharged via a bankruptcy case.

As a result, in this blog series, we will point out and discuss some specific facts to know regarding tax debt and bankruptcy. Although the information presented herein is general, you can easily get specific info and advice regarding your tax debt and possible bankruptcy case by contacting Denver Bankruptcy Attorney Arthur Lindquist-Kleissler today.

Here’s What You Need to Know about Tax Debt and Bankruptcy…

Fact 1 – Tax debt related to income taxes may be dischargeable through bankruptcy.

Tax debt related to personal income taxes may be dischargeable through bankruptcy as long as certain requirements have been met. Contact us for more info about your options for debt relief.

Tax debt related to personal income taxes may be dischargeable through bankruptcy as long as certain requirements have been met. Contact us for more info about your options for debt relief.

Regardless of whether the tax debt is related to state or federal taxes, as long as it is income tax-related debt, it may be eligible for discharge through a personal Chapter 7 bankruptcy case. To effectively be discharged, the tax debt has to:

  • Be related to a tax return that was officially filed with the IRS
  • Stem from an income tax return that was filed at least three years before the bankruptcy petition was filed
  • Have been assessed by the IRS (or the relevant tax authority) at least 240 days prior to filing for bankruptcy.

If any of these requirements have not been met, then getting income tax debt discharged through a Chapter 7 bankruptcy case may not be feasible.

Here, it’s also important to point out that, even if tax debt can’t be discharged, getting other personal debts discharged may still be helpful for a person buried in debt. This is because, by discharging other debts and freeing up some funds, people may be able to put the freed-up money towards paying down their outstanding tax debt.

We will pick up our discussion regarding tax debt and bankruptcy in a few future installments of this blog series – make sure to check them out!

Denver Bankruptcy Lawyer at Lindquist-Kleissler & Company, LLC

Are you or your business overwhelmed by a massive amount of tax debt? If so, Denver Bankruptcy Lawyer Arthur Lindquist-Kleissler can help you figure out your best options for resolving this debt and your financial issues.

Since 1979, Mr. Lindquist-Kleissler and the other legal professionals at Lindquist-Kleissler & Company, LLC have been providing both individuals and businesses with the highest quality of legal services for all of their debt relief and bankruptcy needs. This means that our clients can always count on us and our experience to help them resolve their tax debt and other financial matters as efficiently and favorably as possible.

Contact Us for a Free Consult

For a free 30-minute consult and a free bankruptcy packet, contact us by calling (303) 691-9774, or email us using the form on this page. You will pay nothing up front to obtain trusted, professional advice regarding your case and your options.

From our office in Denver, Arthur Lindquist-Kleissler represents clients throughout the Great Denver Metropolitan area and Colorado, including (but not limited to) Aurora and Arapahoe County.

Categories: Bankruptcy, Blog, Debt, Tax Debt