Brian Kawamoto, Attorney

Bankruptcy And Taxes

We have discharged individual income taxes through bankruptcy for our clients.  The process involved is quite complicated and should only be done by a competent and professional tax or bankruptcy attorney.

For example, the trust fund portion of employment related taxes is not dischargeable, or if there is a civil fraud penalty or you were convicted of tax fraud or tax evasion then your taxes may not be dischargeable. The underlying federal tax lien however is never "discharged" in bankruptcy, therefore the tax lien will continue to attach to any assets that you own.

Basically there are certain tests involved:

• Did you file a tax return if so, how long ago did you file your tax return?  You should file a tax return before the IRS files one on your behalf.
• When were your taxes assessed by the IRS?
• And what year taxes are due and owing?
• Did you file for any extensions for any of these tax years?

All of these questions must first be answered and if there are any "tolling" dates that apply they too must be analyzed to determine whether your taxes are dischargeable. Some examples of tolling dates include whether you submitted a previous Offer in Compromise to the IRS, whether you sought for a Taxpayer Assistance Order, and whether you filed for bankruptcy before.

As you can see it is quite complicated, so if you want to know more about whether your debts are dischargeable please feel free to contact our office and about our bankruptcy tax discharge analysis service.  We have successfully filed both Chapter 7 and Chapter 13 bankruptcies for our clients resulting in the elimination of dischargeable income taxes. For more information about our bankruptcy services visit our blog at http://bankruptcyhawaii.blogspot.com/.

We are a debt relief agency. We also help people file for bankruptcy relief under the Bankruptcy Code under Title 11. Contact us today to learn more about your options under the current bankruptcy laws. We're here to help.