Augusta GA Bankruptcy law firm

Augusta GA Bankruptcy law firm

Tax in Bankruptcy in Augusta Georgia

The first step in the calculation of the tax due is filing a return. As an individual bankrupt debtor, you must file a Form 1040 for the tax year involved, and the trustee of your bankruptcy estate must submit a Form 1041. A bankrupt corporation, or a receiver, bankruptcy trustee, or assignee having possession of, or holding title to, significantly all the assets or business of the corporation, should submit a Form 1120 for the tax year.

After the return is filed, the IRS can recalculate the tax dues shown on the return. When the administrative remedies within the Service have been exhausted, the tax issue can be argued either in the bankruptcy court or in the U.S. Tax Court
The trustee of the bankruptcy estate can request a determination of any unpaid liability of the estate for tax incurred at the time of the administration of the proceeding by the filing of a tax return and a request for such a determination with the Internal Revenue Service. Except when the return is fraudulent or has a material misrepresentation, the trustee, the debtor, and any successor to the debtor will be discharged from liability for the tax upon payment of the tax:
As calculated by the Internal Revenue Service,
As established by the bankruptcy court, after the completion of the IRS examination, or
As displayed on the return, if the IRS will not:
Inform the trustee within 60 days after the request for the calculation that the return has been chosen for calculation, or
Complete the calculation and notify the trustee of any tax due within 180 days subsequent to the request.

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