Wednesday, May 2, 2012

Bankruptcy and Taxes

Most people believe that bankruptcy does not help with past due tax problems with the IRS or Georgia.   If a past due tax is old enough, generally speaking 3 years after the filing of the taxes, you can discharge the personal income tax in Chapter 7 bankruptcy.  If you own a company that owes sales or payroll taxes, a Chapter 11 bankruptcy filing can help your company to survive while you make payments.  If you do not file bankruptcy, the IRS or the Georgia Department of Revenue can shut down your business.  If this happens, they may seek payment of these taxes from the owner.   Trust violations, like failing to send payroll deductions or sales tax receipts, are not dischargable in bankruptcy.   Again, if not addressed by bankruptcy or payment plan, the IRS and Georgia will shut your business down.

I offer advice and experience in helping clients figure out the best way to solve serious tax problems.  The range of solutions is from negotiating a payment plan, to making an Offer in Compromise, to filing a Chapter 7 or Chapter 11 bankruptcy.   Regardless, do not ignore the tax authorities.   The people who work for the IRS and Georgia Department of Revenue are simply trying to do their job.   Having a professional take charge of this process makes their job easier and will provide the best result for you and the government.

Please visit my website at

Please call if you need legal representation to Thomas F. Tierney at (770) 631-1100 or e-mail at