Do Your Tax Returns Have to Be in Order Before You File for Bankruptcy?
Interviewer: When you file, is it required that you submit up to date taxes returns?
You Are Asked to Submit the Last Three Years of Tax Returns When Filing for Bankruptcy
Adam: Typically, they want to look at the last three years of tax returns. Sometimes people lose their records or aren’t that organized. On occasion, you can get away with a little less than that.
What if You Have Not Filed Recent Tax Returns?
Interviewer: What about someone that hasn’t filed taxes? Let’s say they’ve been heading towards bankruptcy and they’ve just procrastinated, and they didn’t file last year. Can they file bankruptcy or do they have to file their taxes first?
A Person Receiving a Teacher’s Pension Might Be Exempt from Filing a Tax Return since It Is Not Taxable Income
Adam: There are people who are receiving pensions that would be exempt, for example a teacher’s pension that they don’t pay taxes on. What they could do is file an affidavit of income as opposed to filing the tax returns.
Interviewer: But normally a person would have to file them, is that right?
Your Attorney May Be Able to Assist You If You Have Not Filed Required Tax Returns
Adam: Yes, that is right. There are ways around the requirement if there has been no taxable income earned by the person filing bankruptcy. For an example, non- taxable income can include an exempt pension or Social Security. Those individuals wouldn’t be taxed; they could sign the affidavit of income.
In the State of Ohio, the New Homestead Exemptions Were Enacted in April
Interviewer: Are there any other upcoming laws that are going to change bankruptcy rules or other ones that have recently been adopted that people might not be aware of?
Adam: I think most of the bankruptcy statutes we’ve seen change in Ohio changed the first of April. That’s when they enacted the new homestead exemptions.
By Adam Hunt