Discharging Federal Income Tax in Bankruptcy
Bankruptcy offers a number of alternatives for relief from federal income tax problems. Older income taxes can often be eliminated in entirety while all taxes, even those recently incurred, can be altered and repaid in an affordable manner. All bankruptcy tax solutions are based on strict laws and written rights for the benefit of delinquent taxpayers that require experienced bankruptcy tax counsel. Bankruptcy tax solutions are prompt and do not require any consent or agreement from the taxing authorities.
The basic treatment of taxes in bankruptcy proceedings falls under Chapter 7, Chapter 11 and Chapter 13 relief. Filing under any chapter of bankruptcy produces an automatic stay on all collection procedures. This means that all efforts to collect, levy or seize assets ceases immediately on all tax liabilities, including:
- Federal and state income tax
- Sales and use tax
- Payroll tax and trust fun liabilities
- Real estate taxes
- Personal property taxes
- Penalties, late fees and interest
Bankruptcy Tax Relief at the Law Offices of Neil Crane, LLC
At the Law Offices of Neil Crane, LLC, we have successfully used all chapters of bankruptcy law to eliminate taxes and restructure all types of taxes for individuals and small businesses throughout Connecticut. The key to our success is the knowledge and experience gained in more than 30 years of bankruptcy tax practice in all three bankruptcy courts under Chapter 7, 11 and 13. Contact us online, call us at 203-230-2233 or call us toll free at 888-249-3027 for a free initial consultation.
Chapter 7 Bankruptcy Tax Relief
This chapter of bankruptcy stops all collection procedures and eliminates older dischargeable income taxes. While the Bankruptcy Code has extremely specific laws for the discharge/elimination of income tax obligations, the basic rule is that income taxes can be eliminated in full under Chapter 7 if they are:
- For a tax period due over three years ago
- The returns have been filed for two years
- No assessment in the past 270 days
Through careful analysis an experienced bankruptcy attorney can work to make sure you are properly eligible for tax relief under Chapter 7.
Chapter 13 Bankruptcy Tax Relief
This comprehensive chapter of bankruptcy provides relief for individuals with all types of tax liabilities, allowing for the discharge of certain taxes similar to Chapter 7, and the repayment of priority taxes over a three- to five-year repayment plan. A properly crafted Chapter 13 Plan produces an automatic stay on all collection procedures and a customized repayment plan for all types of local, state and federal taxes of any kind. Chapter 13 properly prioritizes the repayment of non-dischargeable income taxes above all other forms of unsecured debt, allowing petitioners to repay tax debts with reduced interest rates while eliminating other less critical forms of debt like credit cards and medical bills.
Chapter 11 Bankruptcy Tax Relief
This chapter of bankruptcy provides tax relief for individuals or businesses. The filing of a Chapter 11 proceeding stops all forms of tax office collection procedures by instituting an automatic stay on all collection efforts, liens or levies. It empowers an individual or a business to stop payment on past due taxes and reduce interest rates while allowing for repayment with reduced interest over a period of five years from the bankruptcy filing date. Chapter 11 properly prioritizes income tax repayment over the other types of less important debt through an approved plan of reorganization.
Tax Lien Removal
Bankruptcy also allows for the removal of liens already placed on bank accounts, personal property and real estate property. It can also be used to stop garnishments and levies. Under Chapter 11 and Chapter 13, even long-term liens on property are subject to removal and release from properties with little or no equity. Properly analyzing and prosecuting lien removal actions in the bankruptcy court requires the knowledge and experienced gained by successfully conducting over 10,000 bankruptcy cases throughout Connecticut.
To learn how bankruptcy relief from tax problems can help you, call us at 203-230-2233 or toll free at 888-249-3027. We'll make you a prompt appointment for a free comprehensive tax consultation, you can also contact us online for a prompt response from an experienced attorney.
You will speak directly with an experienced bankruptcy relief lawyer. We never use voice mail. We have office locations in Hamden, Bridgeport, Ridgefield, Waterbury and Rocky Hill for your convenience.
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We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.