Generally, no. Unlike debt settlement, where consumers frequently have to pay income taxes on the forgiven portion of the amount owed prior to the settlement agreement, debts discharged in bankruptcy usually result in no adverse tax consequences for a consumer. A 1099-C form is sent to taxpayers by a financial institution when it has cancelled…
Yes. Income tax debts can be discharged in either Chapter 7 or Chapter 13 bankruptcy. The Bankruptcy Code requires that income taxes: (1) came due at least three years prior to filing for bankruptcy, (2) had a return filed at least two years prior to filing for bankruptcy, and (3) the tax be assessed at…
While working as an Asheville bankruptcy lawyer, I have spoken with people who never thought they would need help with their bills each month. According to a recent study, over 90% of families suffering from financial stress can trace their problems back to either medical issues, divorce, or a job loss. I’ve never met anyone…