Chapter 13 Bankruptcy And Taxes
Talking of the Chapter 13 bankruptcy and the taxes, it should be noted that income tax debts are eligible for discharging under this Chapter. Filing for bankruptcy is one amongst the five possible ways of getting rid of tax debts, but one must consider bankruptcy only when they meet the requirements for the discharge of their taxes. |
Sponsored Links :
|
Chapter 13 is known for providing the payment plans for repayment if some of the debts with the remainder debts get discharged. Under the new bankruptcy laws, the tax debts are considered in the same manner in Chapter 7 as well as in Chapter 13 petitions. But not all of the tax debts are eligible for this discharge under bankruptcy. The person filing for bankruptcy should have tax debts that meet a certain criterion for this discharge.
Tax debts are basically connected with a certain tax return as well as tax year and the bankruptcy law has laid out some specific requirements regarding how old the tax debt must be. Some of the rules regarding the discharging of the tax debts include the fact that the due date for filing the returns should be at least 3 years ago, the tax return should have been filed a minimum of 2 years ago, the tax assessment should be a minimum of 240 days old, the tax return should not be fraudulent, and the tax payer should not be guilty of evading taxes.
Before the discharge is granted, one is required to get the proofs for proving the filing of the previous four tax returns with the IRS.
More Articles :
|
As per Chapter 13 bankruptcy repayment plans, the person is required to repaying the outstanding dues to creditors within a period of three to five years. One is more likely of achieving approval for this bankruptcy application in case the total income of that person is lower compared to the median income within that particular state. During the working with this kind of bankruptcy, the amounts that the person pays in a single monthly installment to the trustee appointed by the court, is actually delivered to the creditors and it is also used to clear up other outstanding but important payments.