On this page General questions for taxpayers in bankruptcy Installment agreements and bankruptcy Balance due inquiry for liabilities that survive the bankruptcy Tax refunds during bankruptcy Bankruptcy resources General questions for taxpayers in bankruptcy How can I speak to the IRS about my bankruptcy case? (added Aug. 5, 2024) Call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time. Be sure to have your bankruptcy case number available. What is the difference between dismissal and discharge? (added Aug. 5, 2024) A dismissal ends the bankruptcy protection and does not relieve debts. A dismissal ends all proceedings in the bankruptcy case (and in any adversary proceedings), and a discharge order is not entered. A dismissal may be voluntary if requested by the debtor. However, a dismissal may also be involuntary (i.e., without the debtor's consent) if the court orders a dismissal or grants a motion to dismiss filed by a trustee or creditor. A discharge is a court order that offers relief by reducing or eliminating certain debts and prohibits the collection of many debts that arose prior to the filing of the bankruptcy. Generally, a discharge is granted: In an individual debtor's Chapter 7 case 60-90 days after the date set for the first meeting of creditors (11 USC 341 meeting); In a Chapter 11 case of a corporation when the plan is confirmed; In a Chapter 11 case of an individual when the plan is completed or when the court grants a hardship discharge; or In Chapter 12 and 13 cases when the plan is completed (3-5 years) or when the court grants a hardship discharge to the debtor. Why did my spouse receive a bill if I was in bankruptcy? (added Aug. 5, 2024) A spouse is not automatically subject to bankruptcy protection or discharge of debt when the other spouse files bankruptcy. If only one spouse filed for bankruptcy, collection action can be taken on the non-debtor spouse in non-community property locations. Collection action cannot be taken against joint assets of the non-debtor spouse in community property locations. All property acquired during marriage is presumed to be community property. Because the non-debtor spouse's interest in community property also becomes a part of the estate, attempts to collect the non-debtor spouse's separate tax liabilities are precluded by the automatic stay in community property locations. Can I get help to reduce my bill/debt? Am I eligible for an offer in compromise (OIC) while my bankruptcy case is open? (added Aug. 5, 2024) The filing of a bankruptcy petition suspends most collection efforts. A bankruptcy discharge may provide relief to a taxpayer by reducing or eliminating certain debts. While in an open bankruptcy proceeding, a taxpayer is not eligible for an offer in compromise agreement. How do we get a lien removed if I am in bankruptcy? (added Aug. 5, 2024) Paying your tax debt in full is the best way to get rid of a federal tax lien. When conditions are in the best interest of both the government and the taxpayer, options for reducing the impact of a lien exist. You may be eligible for a lien withdrawal, subordination, or a discharge of property if specific conditions are met. Please visit Understanding a federal tax lien for more information. Back to top Installment agreements and bankruptcy Can I make payments even though I am in bankruptcy? (added Aug. 5, 2024) In certain conditions, individuals who have filed bankruptcy may make voluntary payments while in bankruptcy. Voluntary payments made by an individual Chapter 7 debtor can be accepted by the IRS. See Chapter 7 - Bankruptcy Basics (United States Courts) for information about eligibility for Chapter 7. Such payments would be applied to debt that is not eligible for discharge. Payments would be considered property of a Chapter 13 estate and should be made through the bankruptcy plan. See Chapter 13 - Bankruptcy Basics (United States Courts) for more information about a Chapter 13 bankruptcy. For information regarding your case, have your bankruptcy case number ready and call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to speak with a technician. Can I set up another payment arrangement? (added Aug. 5, 2024) If you are currently in bankruptcy, your specific tax situation, court jurisdiction and bankruptcy status will determine which payment options are available to you. While you are in bankruptcy, you may contact 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to inquire about your eligibility for a payment plan. If you have been discharged or dismissed and are no longer in bankruptcy, you can visit Online payment agreement application or contact Customer Service at 800-829-1040 for more information. My bankruptcy is over; may I set up an installment agreement to make payments? (added Aug. 5, 2024) If you are a qualified taxpayer, you can apply for a payment plan online to pay off your balance over time. Individuals: You may qualify to apply for a long-term payment plan (installment agreement) if you owe $50,000 or less in combined tax, penalties, and interest, and have filed all required returns. You may qualify for a short-term payment plan (paying in 180 days or less) if you owe less than $100,000 in combined tax, penalties, and interest. Businesses: You may qualify to apply for a long-term payment plan (installment agreement) if you owe $25,000 or less in combined tax, penalties, and interest, and have filed all required returns. Sole proprietors or independent contractors may apply for a payment plan as an individual. Please visit Online payment agreement application for more information. Now that my bankruptcy is over, can I restart my prior payment plan (installment agreement)? (added Aug. 5, 2024) When a taxpayer has an installment agreement and files bankruptcy, the IRS suspends but does not terminate the installment agreement during the bankruptcy. When the bankruptcy case is dismissed or discharged, and there are outstanding liabilities that survive the bankruptcy, we review your account to determine if a reinstatement or revision is appropriate. When this review is completed, you should receive a letter detailing your installment agreement status. Your specific tax situation will determine which payment options are available to you. You can view details of your payment plan, make changes, and obtain additional information by visiting Online payment agreement application. Where do I send my payment? (added Aug. 5, 2024) Pay online, by phone or with a mobile device. Visit Payments or the IRS2Go mobile app for all IRS payment options. If you plan to mail a payment, consider the electronic options first. It’s free to pay from a bank account (Direct Pay) or the Electronic Federal Tax Payment System (EFTPS). You can schedule payments and receive email notifications. Check the status of your account anytime at Online account for individuals. If you pay by check, money order, or cashier’s check, follow the payment instructions on the form you filed or notice you received. Back to top Balance due inquiry for liabilities that survive the bankruptcy Why wasn't my balance discharged? (added Aug. 5, 2024) Only debtors who receive a discharge are eligible to have debts reduced or eliminated. If your case is dismissed, your debt is not relieved. Why am I receiving bills now that my bankruptcy has been discharged? (added Aug. 5, 2024) Not all debts are dischargeable or eliminated. Many tax debts are excepted from the bankruptcy discharge. The scope of the bankruptcy discharge depends on the chapter under which the case was filed and the nature of the debt. Chapter 7 debtors do not have an absolute right to a discharge; objections may be filed by creditors. Chapters 12 and 13 debtors are generally entitled to discharge upon completion of all payments under the bankruptcy plan except for debts that are otherwise non-dischargeable. Why do I still owe a debt after my bankruptcy case concludes? (Chapters 7 and 13) (added Aug. 5, 2024) Not all debts are relieved at the conclusion of a bankruptcy case. Sometimes penalties are discharged but not the taxes for the late filing of a tax return. Certain taxes are not discharged, such as trust fund taxes. Chapter 7 discharge will eliminate (discharge) personal liability for tax debts older than three years unless your tax returns were filed late. Businesses do not receive a discharge since they are liquidated. Chapter 13 discharge will eliminate (discharge) tax debts paid in the plan and tax debts older than three years unless returns were filed late. Your attorney may provide information on your dischargeable taxes, or you may contact the IRS Centralized Insolvency Operation at 800-973-0424 Monday through Friday, 7: a.m. to 10 p.m. Eastern time. Be sure to have your bankruptcy case number available. How much do I still owe? (added Aug. 5, 2024) If you are currently in bankruptcy or your bankruptcy has recently concluded, call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to speak with a technician. Be sure to have your bankruptcy case number available. If your bankruptcy case has been concluded, you may access your Online Account to view the amount you owe by tax year. For more information visit Online account for individuals. Back to top Tax refunds during bankruptcy Why is there a hold on my refund? (added Aug. 5, 2024) You can receive tax refunds while in bankruptcy. However, refunds may be subject to delay, to turnover requests by the Chapter 7 Trustee, or used to pay down your tax debts. If you believe your refund has been held, delayed, turned over, or offset against your tax debts, you can check on its status by contacting the IRS Centralized Insolvency Operation at 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time. Why did the bankruptcy trustee request my refund? Why didn't I receive it? (added Aug. 5, 2024) A Chapter 7 debtor's refund from a tax year before the bankruptcy was filed is property of the bankruptcy estate. Even though the debtor may be in full tax compliance, the refund is subject to turnover to the Chapter 7 trustee if requested. A trustee may request a turnover when a debtor, a custodian, or any other entity in possession of property of the estate fails to turn over that property as required by the Bankruptcy Code. The IRS will honor valid trustee turnover requests and may send the refund to the trustee. Why was my refund offset? (added Aug. 5, 2024) The IRS can offset a pre-petition income tax refund against a pre-petition income tax liability while the automatic stay is in effect. The pre-petition period is the time before the bankruptcy is filed. Pre-petition taxes are incurred prior to the filing of the bankruptcy petition. Your specific tax situation and bankruptcy case will dictate how refunds are handled. For information regarding your refund, call 800-973-0424 Monday through Friday, 7 a.m. to 10 p.m. Eastern time to speak with a technician. Be sure to have your bankruptcy case number available. If your tax refund was offset for child support or a federal agency debt, please contact the specific agency or the Treasury Offset Program (TOP) Call Center at 800-304-3107. Bankruptcy resources For additional tax information on bankruptcy, refer to Publication 908, Bankruptcy Tax Guide. For information on the impact of bankruptcy on taxes visit Declaring bankruptcy. Back to top
