Arizona Bankruptcy Law - Taxes
11 U.S.C. 523. - Exceptions to discharge - provides (a) discharge under section 727, 1141, 1228(a),
1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt - (1) for a tax or a customs duty -
(A) of the kind and for the periods specified in section 507(a)(2) or 507(a)(8) of this title, whether or not a claim
for such tax was filed or allowed; (B) with respect to which a return, if required - (i) was not filed; or (ii) was filed
after the date on which such return was last due, under applicable law or under any extension, and after two years
before the date of the filing of the petition; or (C) with respect to which the debtor made a fraudulent return
or willfully attempted in any manner to evade or defeat such tax.
Arizona Bankruptcy Law - In Practice
Only taxes which were declared, due, and payable, more than two before filing Arizona bankruptcy are
dischargeable. Any deviation from full disclosure will prevent discharge. In practice, expect liens to attach
before the expiration of two years. Tax liens will be enforced against specific property regardless of filing.
The Federal process of filing necessarily incorporates state law requirements. These state law requirements are
set forth in statutes, rules and case law opinions which frequently alter the operation of law. As a result of
these precedents, Arizona bankruptcy cases are unique to the state, as well as unique to each individual who
files. All alternatives provided by law may not be available because of differing individual financial histories
or prior case filings.
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