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Q.Can I get rid of Tax Debts if I file for bankruptcy?
A.Whether a tax debt is dischargeable depends on: (1) the type of tax, (2) whether a tax return was in fact filed; (3) how long the tax debt has been owed; and (4) whether a Chapter 7 or Chapter 13 Bankruptcy is filed. Income Tax debts are generally subject to discharge only if the tax debt was originally due and owing more than three years prior to the bankruptcy filing date and the bankruptcy petitioner has timely filed and fully paid his or her taxes for the three years prior to filing for bankruptcy. Taxes first due within three years of the bankruptcy are not dischargeable. Likewise, taxes for which no return was filed or has been filed within two years of the bankruptcy filing date cannot be discharged. If the bankruptcy filer files a Chapter 7, s/he will still owe such tax debt and if s/he files a Chapter 13, the Chapter 13 Plan must account for the full repayment of such tax debt.
These are general rules and you should speak with a local bankruptcy attorney who can perform a detailed analysis of your specific situation.
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