If you or anyone you know is contemplating bankruptcy, December 31st is an important date. If your bankruptcy case is filed before the year ends, you can keep your income tax refund. Once the year is over, however, the IRS or the student loan collector are allowed to take the refund to apply it to the various governmental debts. Refunds are often thousands of dollars that could be taken if you don’t act before 2015 comes to an end.
April 15, 2016, is another important date. Once that day passes, taxes owed for 2012 become dischargeable in bankruptcy cases. The most recent 3 years of income taxes do not get discharged. Once 3 years have passed since the time the tax came due, that tax year becomes subject to discharge assuming other criteria are met. So, 2012 taxes first came due on April 15, 2013. 3 years after that then makes that year dischargeable.
These tax pointers should help you decide whether you need to file a case. If you are considering dealing with personal income tax debts through Bankruptcy please call us. We are here to help and our consultation is Complimentary.