How does North Carolina's bankruptcy law work? The North Carolina bankruptcy laws explain the legal…
Owe money from taxes, bankruptcy can help. Nobody enjoys thinking about debt, but there’s something about tax debt that makes it feel much more menacing and overpowering than other debts. Mail from the Internal Revenue Service or the North Carolina Department of Revenue can make your stomach turn and lead to major financial ramifications in the future. Find out how bankruptcy could help you acquire some breathing room if some or all of your debt is due to overdue taxes.
Are Bankruptcy Taxes Dischargeable?
Money owed to the IRS or the North Carolina Department of Revenue can be dismissed in some situations through bankruptcy, but there are some criteria that may impair your ability to do so. Some tax debts, on the other hand, cannot be written off. This is why it’s critical to speak with a local bankruptcy attorney. If you learn right away that your debt is nondischargeable, you can decide whether or not bankruptcy is right for you. Non-income taxes, fraud penalties, and payroll taxes are all non-dischargeable.
When Should You File Your Tax Returns?
The most important aspect in determining whether or not your tax burden can be erased through bankruptcy is timing. If the majority of your debt is due to taxes, you must complete bankruptcy requirements in order to be discharged. That amount cannot be discharged if you committed fraud or tax evasion. Similarly, for each year of debt you desire to erase, you must have submitted a tax return. Taxes payable for that year cannot usually be discharged in bankruptcy if you did not file.
In terms of chronology, more than three years must have gone by since your tax return was due; more than two years must have passed since you filed your tax return, and more than 240 days must have passed since the IRS or State assessed your taxes as of the date your bankruptcy case is filed.
Some years may be dischargeable, while others may not, depending on your tax circumstances. Your lawyer can examine your tax returns and advise you on your alternatives.
So you owe money from taxes, bankruptcy can help. Our tax attorneys can assist you. Contact Hoarding Law for more information. Hoarding Law works with families all around North Carolina to help them achieve their financial objectives. To schedule a free phone consultation, call (704)-954-8094.