Bankruptcy in Brief

Priority taxes 

Taxes first due within three years of the bankruptcy and taxes assessed within 240 days of the bankruptcy, or which are unassessed but assessable when the case is filed, are priority claims which are not subject to discharge.

	Priority taxes will survive a Chapter 7 discharge to the extent that the trustee does not have money in the estate to pay them.
	In Chapter 13, such taxes must be paid in full through the plan; penalties associated with those taxes, however, can be treated as a non priority claim and paid a fraction along with other unsecured claims.  In Chapter 13,  the tax does not continue to incur interest during the case;  if the plan is completed, no post filing interest is due.

Taxes for which no return has been filed are not dischargeable in bankruptcy.

If a return was filed late, for a year outside of the priority tax period, the return must have been on file for two years for the tax to be discharged in bankruptcy.

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