Anywhere you are in the nation, Florida included, tax season always springs up at the same time of year. In the current atmosphere of economic change, you might be tempted to neglect giving your business’s taxes the full attention they deserve. That neglect is even more likely if you have accrued other debts you believe should take priority. At Kingcade & Garcia, P.A., we often help clients with tax issues during debt relief and bankruptcy processes, but we are only empowered to do so if our clients have stayed diligent in their past filings.
Federal tax debt is likely one of the most persistent financial liabilities you have acquired, but that does not mean it has to follow you forever. Chapter 7 bankruptcy might provide an opportunity to free yourself of these debts. There is one major caveat, however: Only income tax is eligible for the process.
Your tax would be subject to several other rules before it could qualify for discharge. The Findlaw section on federal tax debt relief under chapter 7 lists a number of the factors that could affect the amount of debt you would be able to discharge:
- Age of your tax debt and the IRS assessment thereof
- Legitimacy and regularity of your filings with the IRS
- Previous attempts you may have made to evade taxes
- Liens against your property
You may have noticed that some of these qualifying factors are well within your control. You may decide to fill out your returns and send them in every year, for example. We typically find that our clients who dutifully file taxes, regardless of the financial direction of their businesses, reap significant rewards. These benefits often come in the form of greater access to debt relief under the strict rules of chapter 7 bankruptcy. This information is general educational material: Please do not regard it as legal advice.
