By: Daniel Stone
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Are IRS taxes dischargeable in bankruptcy?
IRS tax debt article written by Columbia, SC bankruptcy attorney Daniel Stone Are IRS taxes dischargeable in bankruptcy? The short answer is some are. The Internal Revenue Services has a specific code section dealing with income taxes and dischargeability in bankruptcy.http://www.irs.gov/irm/part5/irm_05-009-002.html . The code states that in order to be discharged, a few elements must be met. First, the income taxes must have been due at least three years prior to filing, taxes must have been filed on time or at least two years prior to filing, taxes must be assessed more than 240 days prior to filing the bankruptcy, the Debtor must not have intended to willfully evade taxes, and finally, this test only applies to income taxes – not corporate, employee, or other forms of taxes. One final note, this only applies to unsecured taxes. If the IRS has filed tax liens, I may still be able to assist you, but there are additional elements that an attorney will need to review with you to see how much of your IRS taxes can be discharged. Please note , I recommend seeing a bankruptcy attorney to learn more about this issues due to the complexity. There are plenty of caveats to this issue to include, but not limited to: tolling provisions (if you have filed Chapter 13 at anytime, the IRS may have deemed this period as “tolling” the time period listed above, not filing your tax returns on time, and audits.