|Clear income tax debt by filing for bankruptcy.|
Yes—you are able to discharge certain federal and state income taxes by filing for Chapter 7 or Chapter 13 bankruptcy. Only income taxes can be discharged in bankruptcy.
Meet the requirements listed above and you may discharge your income tax debts by filing for Chapter 7 bankruptcy. If you qualify for Chapter 7 bankruptcy, you may eliminate unsecured nonpriority debts such as your credit card debt, debt from medical bills, and payday loan debt, as well.
Filing for Chapter 13 bankruptcy does not immediately discharge tax debt. First, you must determine if your income tax debt is a priority or nonpriority debt.
Your tax debt is considered nonpriority when it meets the qualifications listed above. Otherwise, it is considered priority and must be paid off over the duration of the 3-5 year repayment period.
You will pay a percentage of your nonpriority tax debt over the course of the repayment period. When you complete the repayment period, the remainder of your nonpriority tax debt is discharged.
Filing for bankruptcy requires meticulous attention to detail and intimate knowledge of bankruptcy law. Attempting to file for bankruptcy by yourself can be frustrating and exhausting without the help of an experienced professional. Steven R. McDonald is the helping hand you need to re-gain control of your financial present and future.