How does the bankruptcy court treat outstanding taxes if filing for a Chapter 7?

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How does the bankruptcy court treat outstanding taxes if filing for a Chapter 7?

The debtor is underemployed.

Asked on February 25, 2014 under Bankruptcy Law, District of Columbia

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

Unfortunately, the outstanding taxes won't be discharged by filing bankruptcy.  You might want to consider contacting the IRS or the state if it is state taxes to negotiate an Offer in Compromise, which is settling the matter for a lesser amount than the entire amount owed.  Another alternative may be a payment plan with the IRS or state.


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