Bankruptcy and Tax in Macon, Georgia

Bankruptcy and Tax in Macon, Georgia

When you are an individual debtor in Macon, Georgia filing for bankruptcy under chapter 7 or 11 of the US Bankruptcy Code in , an independent ‘‘estate’’ is created comprising of assets which belonged to you prior to the date of filing. This bankruptcy estate will be a new taxable entity, completely independent from you as an individual taxpayer.

There is no penalty for failure to pay tax, including failure to pay estimated tax, will not be imposed for any period during which a title 11 bankruptcy case is pending provided:
1. The tax was incurred before the earlier of the order for relief or (in an involuntary case) the appointment of a trustee, and
2. The bankruptcy case was filed before the due date for the tax return (including extensions) or the date for imposing the penalty occurs on or after the day the bankruptcy case was filed.

This relief from the failure-to-pay penalty does not apply to any penalty for failure to pay or deposit tax withheld or collected from others and required to be paid over to the US government. Nor does it apply to any penalty for failure to timely file a return.

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