Legal Question in Bankruptcy in New York

For income taxes to be discharged in bankruptcy, the taxes must have been due not less than three years prior to the bankruptcy filing. For example, if you were to file bankruptcy now, income taxes for the years 2006 and earlier can be discharged. (Because the 2006 taxes were due April 15, 2007). This assumes that you filed your tax return on time. If you filed late, then the three years runs from the date the tax return was filed. If you did not file a tax return, then the taxes cannot be discharged.

To have income taxes discharged, it is necessary to obtain an order from the bankruptcy court declaring the taxes discharged. This is done by bringing an adversary proceeding in the bankruptcy court against the taxing authority (state or federal). Usually these proceedings are not contested. However, there are situations where the taxes cannot be discharged � e.g. if fraud was committed by the debtor.