Asked in Bankruptcy for Louisiana

Q: Will bankruptcy discharge Louisiana state individual income tax 7 to 9 yrs old ?

Tax and interest of $15,000

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3 Lawyer Answers
W. J. Winterstein Jr.
PREMIUM
W. J. Winterstein Jr.
Answered
  • Bankruptcy Lawyer
  • Boyertown, PA

A: The Bankruptcy Code enables a bankrupt debtor to discharge certain kinds of income tax debt, specifically, those for which an accurate return has been filed more than two years and four months prior to the bankruptcy filing. The IRS official position on this issue is set forth here. www.irs.gov/businesses/small-businesses-self-employed/declaring-bankruptcy.

I have represented an individual debtor who discharged over one million dollars in accrued income tax debt.

There are "wrinkles", so be sure to confer with an experienced bankruptcy attorney in LA to consider your full financial circumstances and answer all your questions.

Timothy Denison agrees with this answer

Timothy Denison
Timothy Denison
Answered
  • Bankruptcy Lawyer
  • Louisville, KY

A: Yes, if properly and timely filed.

James L. Arrasmith
PREMIUM
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Answered
  • Bankruptcy Lawyer
  • Sacramento, CA

A: The dischargeability of state income taxes in bankruptcy depends on several factors. In general, for income taxes to be dischargeable, they must meet the following criteria:

1. The taxes are income taxes (which appears to be the case in your situation).

2. The taxes were due at least three years before the bankruptcy filing date.

3. The tax returns were filed at least two years before the bankruptcy filing date.

4. The taxes were assessed by the state at least 240 days before the bankruptcy filing date.

5. The tax returns were not fraudulent, and the taxpayer did not engage in willful tax evasion.

If your Louisiana state income taxes meet all of these criteria, they may be dischargeable in bankruptcy. However, it's important to note that every case is unique, and the specific details of your situation will determine the outcome.

Given the complexity of this matter and the amount of money involved ($15,000), it is highly recommended that you consult with a bankruptcy attorney who is familiar with Louisiana state tax laws. They can review your case in detail and provide guidance on whether filing for bankruptcy is the best option for resolving your tax debt.

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