Tax Forgiveness & Resolution

Can Tax Debt be Discharged Through Bankruptcy?

Are you eligible for tax forgiveness for back taxes owed to the Internal Revenue Service (IRS)? Many people believe that tax debt cannot be discharged through bankruptcy, but that is false. Filing bankruptcy may help you discharge back taxes, interest and penalties. Do you qualify for tax forgiveness? Our firm can help you determine your eligibility.

In order to discharge tax debt, you must meet the following criteria:

  • Your tax debt must be at least three years old before filing
  • Your debt must be assessed by the IRS at least 240 days prior to filing
  • Your tax return must have been on file for at least two years

How Tax Debt is Treated in Chapter 7 & Chapter 13

Provided that these factors are in place, you may be eligible to file under Chapter 7, Chapter 11 or Chapter 13. In Chapter 7 bankruptcy, an "automatic stay" is enacted which immediately stops creditor collections. Debt should be discharged about 90 days after the case is opened. Only after debts are discharged can the IRS pursue collection.

During the interim, you can plan for repaying any debt that is not discharged. Chapter 13 bankruptcy, or "reorganization bankruptcy," gives you time to repay what you owe in smaller amounts. Some debts can be discharged through Chapter 13 bankruptcy as well. Make sure you choose the right bankruptcy solution by speaking to a lawyer today.

Speak with a Dallas Bankruptcy Lawyer for Free

Speak with our bankruptcy attorney in Dallas, Texas about the options best-suited for your situation. We can work with you find a way to help you resolve tax liens, wage levies, and even to remove existing tax liens. We're here to guide you through this process. Schedule a free consultation to discuss your debt relief options. We've helped tens of thousands of clients resolve their debt, and we're ready to help you too.

You can reach Allmand Law Firm, PLLC at (214) 238-9608 – give us a call today!