Bankruptcy and Tax

When it comes to the matter of bankruptcy and taxes, there can be several very serious things that you might want to first consider. If you are going to file for bankruptcy, you will want to ensure that you are doing everything that you can in order to save yourself as much trouble, money, and time as you possibly can.

You should know that any income tax debts might be eligible for being taken care of under Chapter 7 or chapter 13. If you are willing to file for bankruptcy, this is one of five ways that you can get yourself out of tax debt. Nevertheless, you should try to remember that in order to get your taxes discharged by filing for bankruptcy, you will have to meet certain requirements, so you should make sure that you meet them before you decide to file for bankruptcy in order to get yourself out of tax debt.

If you file for Chapter 7, you are going to be able to get fully discharged of the debts that are allowable. With Chapter 13, there will be a payment plan that will be required so that you can pay back some of your debts, and the rest will be discharged. Don’t forget that not all of the tax debt that you might have is going to be discharged if you file for bankruptcy. You will have to meet five criteria in order to get your taxes taken care of.

These five criteria that you will require to meet in order to get your tax debt discharged when you file for bankruptcy is also very important. The first is that the date that the tax return was due was at least three years ago. The second is that the tax return had been filed at least two years ago. The third is that the tax assessment is at least 240 days old. The fourth is that the tax return cannot have been fraudulent. And the fifth is that you are not guilty of any kind of tax evasion. If you can meet all of these five criteria, you are going to be able to most likely get your tax debt discharged when you decide to file for bankruptcy.

Don’t forget that filing for bankruptcy also tends to carry its own consequences, especially on your credit. You should not file for bankruptcy just in order to be able to get out of paying your tax debt, because it is going to do much more harm than good in the long run when it comes to the damage done to your credit. Only file if you have no other option and if you’ve been told that it is your best chance for beginning to rebuild your life.

Article Source: http://www.debtfinancearticles.com.

About the Author:
Elliott Dawson is a contributing real estate editor at http://www.debtfinancearticles.com/. This article may be reproduced provided that its complete content, links and author byline are kept intact and unchanged. No additional links permitted. Hyperlinks and/or URLs must remain both human clickable and search engine spiderable.