Oklahoma Bankruptcy HelpFAQ: Bankruptcy and Taxes in Oklahoma

Bankruptcy and taxes sometimes go together in Tulsa, Oklahoma, but the laws are complicated. As a general rule, you can only discharge older local, state, and federal income tax debts in bankruptcy.

Bankruptcy and Taxes: Time Frames

Before filing bankruptcy in Oklahoma, you must have filed any tax returns required of you for the previous four years, according to the Internal Revenue Service (IRS).

To discharge a tax debt, the applicable tax return must have been originally due at least three years before you declare bankruptcy. In other words, people filing bankruptcy in 2020 cannot discharge a 2018 tax debt. For more specific concerns, contact a Tulsa bankruptcy attorney at 918-786-9600.

If you filed a tax return late, you must wait at least two years to include it in your Chapter 7 or Chapter 13 case.

Handling Taxes During Bankruptcy

Since it can take up to four months to get a Chapter 7 bankruptcy discharge and three to five years to complete a Chapter 13 repayment plan, it is important to also consider how to handle taxes and bankruptcy in the future.

You must file all federal tax returns during your bankruptcy or obtain the appropriate extensions from the IRS. Failure to do so can lead to a U.S. Bankruptcy Court judge dismissing your entire bankruptcy case.

Also, you must either pay federal taxes as they come due or make the appropriate payment arrangements with the IRS. Again, failure to do so can lead to the dismissal of your request for bankruptcy relief.

Additional Considerations

Only income taxes are eligible for bankruptcy relief; payroll taxes and fraud penalties are not.

Also, you must not have deliberately evaded filing or paying your taxes or committed another crime such using a false Social Security Number when dealing with the taxation body. This applies whether it is the IRS or the Oklahoma Tax Commission.

How We Can Help You

Our mission at Financial Freedom Bankruptcy Lawyers of Tulsa is to provide you the information and legal representation you need to climb out of debt and get back onto solid financial ground.

Free Bankruptcy Planning: Tulsa Bankruptcy Lawyer

To get the best possible outcome in your case, you will need to set expectations for yourself and also understand your attorney’s expectations of you.

To receive your free initial bankruptcy analysis, call Financial Freedom Bankruptcy Lawyers of Tulsa today at 918-786-9600.