Columbia County GA Bankruptcy attorneys – Tax debt and bankruptcy
Taxes and Bankruptcy in Columbia County Georgia
Bankruptcy process starts with the filing of a petition in the bankruptcy court. The filing of the petition establishes a bankruptcy estate, that usually consists of all the possessions of the person filing the bankruptcy petition. An independent taxable entity is established when the bankruptcy petition is submitted by an individual under chapter 7 or chapter 11 of the Federal Bankruptcy Code.
The tax obligations of the person seeking bankruptcy protection differ based on the bankruptcy chapter under which the petition is filed. Usually, if a debt owed to someone is forgiven the amount forgiven is considered income taxable to the one owing the debt. When the debt is canceled by a bankruptcy proceeding, the amount canceled is not income. But, the canceled debt decreases the amount of other tax benefits the debtor would otherwise be eligible to. ———————
We are Augusta GA bankruptcy lawyer | Georgia attorney that assist their clients in filing for Chapter 7 Bankruptcy and Chapter 13 Bankruptcy in Augusta GA.
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