Kentucky Bankruptcy Law

Counsel with Care

Deadlines for Filing Prepetition Tax Returns in Chapter 13 Cases

It is good practice for a Debtor’s attorney’s to always obtain all four years of returns prior to filing to avoid a hiccup. I often run into the challenge of my client not retaining copies ot their tax returns. This can be quickly remedied by having your client go onto irs.gov and apply for “Tax Transcripts” for the years in question.

This Tax Transcript is not to be confused with an Account Transcript. The Account Transcript provides various codes and dates of events over time for a given tax year. These codes can allow an attorney to determine what taxes can and cannot be discharged in a Chapter 13.

Chapter 13 Trustee, EDKY: Trustee's Blog

Frequently, debtors who seek bankruptcy relief under chapter 13 have not yet filed some of their tax returns with the IRS or state taxing authority.  Section 1308 of the Bankruptcy Code gives chapter 13 debtors an opportunity to get those returns filed so they can deal with their tax debts in the chapter 13 case, but there are deadlines to be met and consequences for failure to comply.  Until all tax returns for the previous four years are filed, the plan cannot be confirmed, and if the returns are not timely filed, the debtor’s case could be dismissed.

What tax returns are required?  Section 1308 refers to “all tax returns.”  This means not only federal and state income tax returns, but returns for state sales tax, state highway tax, employers’ state and federal tax returns, and all other returns the debtor has been required to file during the previous…

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February 14, 2017 - Posted by | Uncategorized

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