Legal Question in Bankruptcy in New York

Bankruptcy on Back Taxes

If a person were to file for Bankruptcy, Chapter 7, and they owed an income tax for the year 1993 only, which has not been filed yet, would they be able to discharge said tax since it is 1998, five years later? I read somewhere that if it were 3 years old, then it may be dischargable, but is it three years from the year owed, or three years from the date of actually filing the tax return? The '93 income tax will be filed this year with the 1997.


Asked on 2/14/98, 9:20 pm

1 Answer from Attorneys
Daniel Press Chung & Press, P.C.

Discharge of old taxes in bankruptcy

In a Chap. 7, income taxes are dischared if they meet the following conditions:-Due date of return (including extensions) was at least 3 years pre-petition.-Return actually filed at least 2 years pre-petition.-Taxes not assessed within 240 days pre-petition-Return not fraudulent or evasive

In a Chapter 13, if the tax is over 3 years old and not assessed within 240 days pre-petition, it is not a priority debt and can be paid less than in full, even if not filed or fraudulently filed. If you owe significant unfiled taxes for 1993, you maywant to consider Chap. 13. Ask your lawyer.

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Answered on 2/17/98, 3:16 am


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