Chapter 13 and tax returns

Since some taxes must be paid full during the ch13 bankruptcy, the taxing authorities want all your returns filed so they know how much is owed. So in a Chapter 13 bankruptcy, the State and Federal taxing authorities will not allow a plan to be confirmed w/o all tax returns being filed. It doesn’t matter if you owe, the taxes aren’t going away so you may as well file them.

Even if the tax returns aren’t due yet, the tax returns need to be filed before confirmation (this is mainly for clients who file before 4/15). The other big issue is GE taxes. If you had any rental income or Sch C income on your Fed taxes, the state tax department expects GE returns unless you can show all the business took place outside of Hawaii. If you didn’t do any business under your GE tax license, you need to file 0 returns for all unreported periods or cancel the GE licence back to the last time you had any GE taxable income.

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