Free Yourself from Tax Debt in Bankruptcy
Unpaid taxes can accumulate large amounts of interest and civil penalties until the debt becomes overly burdensome and unmanageable. The government, meanwhile, has tremendous resources at its disposal and a number of ways to get their money from you. If you had a dispute over the amount of tax owed, or if you trusted your tax preparation to a professional or family member who did not keep you properly informed, you may not be aware of your full tax liability until it has grown to overwhelming proportions. As an experienced bankruptcy attorney with over 25 years helping people in Western Kentucky find solutions to their financial troubles, the law office of Lanna Martin Kilgore, PLLC in Bowling Green can help you determine whether bankruptcy is an appropriate solution for your tax problems and provide effective assistance in getting you debt relief.
Discharging Federal Income Tax in Chapter 7 Bankruptcy
A federal income tax debt may be dischargeable in a Chapter 7 bankruptcy, but only if it meets certain conditions. For instance, the debt must relate to a tax return that was filed at least two years ago but had a filing deadline over three years ago, counting extensions. Also, the tax assessment must be at least 240 days old. If these conditions are met, the debt may be dischargeable in bankruptcy, assuming the tax return is not fraudulent and there isn’t any evidence of tax evasion. If your tax debt meets these conditions, talk to your bankruptcy lawyer about the possibility of having this debt discharged in bankruptcy.
What about other tax debt?
State income tax, estate and gift tax, and other types of taxes are generally not dischargeable in bankruptcy. If a nondischargeable tax debt is the source of your money problems, you may be able to negotiate an offer in compromise or work out an installment plan with the IRS to keep them from putting a lien on your bank account or taking other measures against you. If tax debt is only one of a number of bills you are struggling with, bankruptcy may still be the answer. By reducing or getting rid of dischargeable debt, such as medical bills and credit card debt , you may be able to free up enough disposable income to pay down the tax debt on a comfortable schedule and avoid the interest and penalties that can pile up from unpaid taxes.
Get Help Today with Your Tax Difficulties and Other Financial Problems
At the law office of Lanna Martin Kilgore, PLLC in Bowling Green, we take a look at your total financial picture and help you determine a strategy to get on top of your finances through bankruptcy and/or other available means. In Bowling Green, Warren County and throughout western Kentucky, call our office at (270) 846-3700 or contact us online to schedule an appointment and visit with a knowledgeable and experienced bankruptcy attorney.