How Good People Solve Bad IRS Problems - Nick Nemeth - Manual / Resource - Page 44
End Your IRS Problems
Chapter 12: Can You
Discharge Your Taxes
Most people, including many attorneys, either don’t
know or don’t believe that you can discharge your
income taxes in Bankruptcy.
The current Bankruptcy code may allow you to
completely discharge income taxes in Bankruptcy. This
means you may be able to walk away from 100% of
your income taxes, penalties, and interest.
General Rules for Discharging Income Taxes in a
Chapter 7 Bankruptcy.
Chapter 7 is the best kind of Bankruptcy as it allows
you to eliminate most of your debt and pay practically
Review these rules to see if your income tax debt
qualifies for discharge in Bankruptcy:
The tax years you owe taxes for must be more than
three years old. For example, as of April 15th, 2007,
taxes for years 2003 and earlier would qualify for
You must have filed the tax returns for the years
you are considering discharging at least two years
before you file for Bankruptcy.
The tax years you are considering discharging
in Bankruptcy can’t have had any additional
assessments of tax within the 240 days prior to
your Bankruptcy filing. (In English, this means