This paper discusses the discharge of taxes under the Bankruptcy Abuse Prevention and Consumer Protection Act (“BAPCPA”).
Under pre-BAPCPA law, the discharge of taxes was treated differently depending on whether the debtor filed bankruptcy under Chapter 7 or 13. However, under BAPCPA, the Chapter 13 rules greatly resemble those in Chapter 7. Thus, a Chapter 13 debtor can no longer receive a discharge of non-filed taxes or fraudulent tax returns. Similarly, a corporate debtor cannot now discharge taxes if the debtor has made a fraudulent return or willfully attempted to evade or defeat the tax. The paper further discusses changes made by BAPCPA including the discharge of taxes paid by credit card, the determination of tax liability, and the filing of tax returns.
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