Pre-Bankruptcy Tax Strategies
Get the maximum benefit from your bankruptcy against your taxes by following these sophisticated strategies.
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Entries by PDX Law Group
To Win the Chapter 13 Tax Prize, You Have to Finish the Race
A Chapter 13 case can be such a good tool for dealing with income tax debt, especially if you owe more than just a year or two of taxes. BUT, you lose those benefits if you don’t successfully finish paying off the Chapter 13 plan. So, go into it only if you have both a burning desire to make it all the way, and a truly feasible plan with which to do so.
The Benefits of a “Short Tax Year Election” in an Asset Chapter 7 Case
Your Chapter 7 trustee can use your unneeded assets to pay current-year income taxes if you split the calendar tax year into two: the pre-bankruptcy and post-bankruptcy “short years.”
Writing Off Income Taxes Forever through Bankruptcy
What income taxes can a Chapter 7 bankruptcy completely write off?
Three Big Ways Bankruptcy Helps with Income Taxes
Bankruptcy CAN 1) legally write off some income taxes; 2) stop IRS wage garnishments, bank account levies, and tax liens; and 3) enable a faster payoff of the taxes you must pay, by avoiding most ongoing interest and penalties.
Income Tax Refunds in a Chapter 13 Case
Chapter 13 gives you more flexibility about what you can do with your current income tax refund. But unlike Chapter 7 which doesn’t care about your future years’ refunds, Chapter 13 does.
Income Tax Refunds in Chapter 7 Bankruptcy
Can you keep your tax refund if you file a Chapter 7 case? It’s mostly a matter of timing.
Business Disputes that Get Dragged Into Your Bankruptcy Case
Creditors can challenge your ability to legally discharge your debts in a bankruptcy case. These challenges happen more in bankruptcy cases to clean up after the close of a business. Avoid the creditor challenges for a cleaner case.
Taxes in a Closed-Business Bankruptcy Case
Dealing with taxes from a failed business through a bankruptcy–that sounds complicated. But I’m going to keep it simple here. What are your basic options if you owe taxes after closing down a small business?
“Asset” and “No Asset” Closed-Business Chapter 7 Cases
When the sole proprietor of a just-closed business files a personal Chapter 7 bankruptcy case, the trustee may or may not have assets to liquidate and distribute to the creditors. If NOT, the case will more likely be finished faster. But if the trustee DOES collect some assets, the extra time may be worth it for the former business owner.