If we pay our tax debt in full, can we file for bankruptcy?
It depends. You aren’t typically penalized in bankruptcy court for having paid your taxes in full. But if your tax debt was your only debt, you won’t need to file bankruptcy anymore. There are different categories of debt in a bankruptcy case. There are secured, unsecured, priority and non-dischargeable debts. Taxes are a priority debt in a bankruptcy case, meaning they are treated differently from secured and unsecured debts. In fact, sometimes taxes are non-dischargeable in a case.
There are a few additional facts that a bankruptcy attorney would need to review with you to see if you are in a position to file bankruptcy or not (besides the means test etc.) — First, what kind of taxes did you pay in full, were they business taxes (like payroll) or were they personal taxes. Also, how old were the taxes and then, can this payment be considered a preferential transfer.
So, you can get a free bankruptcy consultation by consulting this law firm. That is what I recommend because in order to answer this question, must more detail needs to be provided in your factual circumstances to provide accurate information. I hope that makes sense. Give this bankruptcy lawyer a call - he’ll do a free consultation with you - good luck!
Ascent Law LLC
8833 S Redwood Rd Suite C
West Jordan UT 84088
(801) 676-5506
