Can I discharge taxes in a Chapter 11 bankruptcy?

Yes, taxes can be discharged in a Chapter 11 bankruptcy in North Carolina. In Chapter 11 bankruptcy, debtors are allowed to reorganize their debt without the risk of liquidation. Chapter 11 allows debtors to discharge certain unsecured debts such as taxes. In order to discharge taxes in Chapter 11 bankruptcy, the taxes must meet specific criteria. According to the U.S. Bankruptcy Code, the taxes must have been due for a minimum of three years and the debtors must have filed tax return for that year. Furthermore, the bankruptcy must have been filed at least two years after the tax return was due. In addition, taxes that do not meet certain criteria will not be eligible for discharge in a Chapter 11 Bankruptcy. For example, income tax liabilities that are less than three years old, payroll taxes, estate and income taxes of a fiduciary, and fraud or willful evasion of taxes cannot be discharged. It is important to note that the Bankruptcy Court for the Eastern District of North Carolina has the final decision as to whether a debtor’s taxes will be discharged in Chapter 11 bankruptcy or not. Therefore, debtors must consult with an experienced and knowledgeable attorney who is familiar with the bankruptcy laws in their state. An attorney can help debtors understand the process of filing for bankruptcy, as well as determine if they are eligible to receive a discharge of taxes in a Chapter 11 bankruptcy.

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Can I discharge taxes in a Chapter 11 bankruptcy?

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