San Diego Discharge of Tax in Bankruptcy Lawyer
It is not commonly known that taxes can be dischargeable in a chapter 7 bankruptcy, but there are several specific criteria that must be met in order to determine the dischargeability for each tax year for which a balance is due.
The criteria are as follows:
- At the time the bankruptcy petition is filed, the due date of the tax return must be three years prior to the filing date;
- The time the bankruptcy petition is filed, the tax return must have been filed by the taxpayer more than two years prior to the filing date;
- 240 days must have elapsed subsequent to the assessment of the tax;
- There can be no evidence of willful evasion of the payment of tax; and
- There can be no evidence of fraud in the preparation of the tax return.
The interpretation of these criteria requires a complex and extensive analysis, and I have encountered success in obtaining discharge of millions of dollars in tax.