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St Louis Bankruptcy Lawyer: Can My Tax Debts Be Paid Back Inside A Bankruptcy?

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Yes, they can be paid back with a St Louis Chapter 13 repayment plan. Tax debts are considered to have priority status with the Bankruptcy Court, so those kinds of debts are paid to the taxing authority ahead of many other creditors. But in addition to this, there are occasions when some of your tax debts can actually be discharged. A brief description is given below:

A Chapter 13 is described as a repayment plan over the course of three (3) to five (5) years during which certain debts are paid back (such as mortgage arrearage, car notes, back child support, tax debts, and sometimes a portion of your unsecured debts). As mentioned above, tax debts are given priority status (and therefore carry a presumption of non-dischargeability). But sometimes tax debts can be knocked out.

Here are a couple of typical scenarios:

  1. If the state of federal income tax that you owe is three years or older (for instance, it is 2015 right now, so tax debt from 2011 or older), you have filed those older returns at least two years ago (for instance, if you owe federal tax from 2009, and you filed a return for that year in 2012, that would be at least two years prior), and the taxing authority has not performed an audit (for example, if taxman comes to this year and claims that you have to file an amended return because you did not include income from your sides jobs on the 2009 return), then that portion of the income tax debt that you owe can be discharged.
  2. If the personal property tax that you owe (which is a tax that the state of Missouri puts upon ownership of certain assets, like an automobile) is one year or older, then that portion of your personal property tax debt can be discharged. Ex. If you owe personal property tax from 2013, that can be discharged; but if you owe pp tax for 2014, that cannot be discharged (because this particular tax does not come due until December 31 of the year, which means that pp tax from 2014 is still less than one year old).

So as you can see, there are certain times when taxes can be knocked out. Whatever portion that is left over (that portion that cannot be discharged) is then added in to your repayment plan inside the Ch13.

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But the best way to fully understand your rights and options is come in and see us!! We will answer all your question, and set you on the best path possible! All it takes is a phone call!!!

The affordable St. Louis bankruptcy attorneys at Brinkman & Alter, LLC have been saving and protecting people’s assets for years. Our goal is to make sure that you keep the assets and property you want, discharge the debts that you want to get rid of, and do it all at an affordable cost to you. All phone conversations and office consultations are free of charge.