Common wisdom — and even many lawyers — assert that "most tax debts cannot be wiped out in bankruptcy." In fact, this statement when considered alone without qualifications is a bankruptcy myth.
There are many situations in which tax debts can, in fact, be discharged in bankruptcy. For specific information on this topic, please see the following articles contained in this website:
- Five rules for discharging taxes in bankruptcy
- Calculating the three-year time period for discharging taxes in bankruptcy
- How to discharge or wipe out taxes in bankruptcy
Information found on these pages can answer some of your questions and concerns regarding taxes and bankruptcy. However, keep in mind that an individualized analysis of your particular set of facts and circumstances is necessary in order to answer the question more specifically for your case. Therefore, we urge you to discuss your situation with a knowledgeable bankruptcy attorney before leaping to conclusions or using the issue of taxes as an argument for or against declaring bankruptcy.
Discharging Tax Debts in Bankruptcy: Chapter 13 Bankruptcy May Be the Answer
For many people, a need to resolve unpaid back taxes becomes a reason to file Chapter 13 bankruptcy. This variety of bankruptcy — as opposed to Chapter 7, which discharges consumer debts — allows many debtors to take care of taxes and mortgage arrearages through bankruptcy.
Our New Jersey bankruptcy attorneys and staff take your concerns seriously. To discuss your questions about bankruptcy and taxes with careful attention given to your particular circumstances, call or e-mail us.
Contact one of our lawyers today for a free initial consultation. We have offices in Wayne and Hoboken to serve you better.
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