Filing for Chapter 13 bankruptcy may be the best way to handle unpaid taxes or back taxes. If you have a current dispute with the IRS over unpaid taxes, the bankruptcy court has the power to decide such disputes in Arizona. The IRS often welcomes the Chapter 13 bankruptcy filing because they must be paid for all priority taxes prior to all the other debts being discharged.
Recent tax debt (but not interest and penalties) will be repaid in a Chapter 13 bankruptcy, not discharged. The bankruptcy court will make sure that the repayment plan is reasonable for you. While the IRS is technically a creditor alongside all of the other creditors, some types of taxes take a priority position in the distribution process. The trustee in Chapter 13 bankruptcy will be directed, based on the law and your Chapter 13 plan, which creditors are repaid, at what amounts, and at what priority.
There are some conditions to having the Chapter 13 repayment plan confirmed, such as being current on tax return filing. And any tax debt or penalties acquired after the bankruptcy filing would generally not be included as part of your Chapter 13 Plan. The bankruptcy attorneys at The Frutkin Law Firm, PLC, in Phoenix, AZ can help you determine if your tax debts can best be handled with a Chapter 13 bankruptcy.
Tags: Arizona, AZ, back taxes, bankruptcy, bankruptcy attorneys, bankruptcy court, bankruptcy filing, Chapter 13, Chapter 13 Plan, Chapter 13 repayment plan, filing for chapter 13 bankruptcy, Frutkin Law Firm, IRS, Phoenix, unpaid taxes
