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Can You Discharge Capital Gains Taxes in Bankruptcy

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  • 03-16-2014, 09:32 AM
    nch
    Can You Discharge Capital Gains Taxes in Bankruptcy
    My question involves bankruptcy in the state of: NH
    Our LLC has virtually no debt except mortgage and an SBA Guarantee on a grant, and we have no personal debt. We will proceed with a deed in lieu of foreclosure to clear the business. I understand we will be assessed capital gains tax on the 'gain' - is that dischargeable? That is really the major reason to file ch 7. i cant seem to get a straight answer anywhere. thanks.
  • 03-16-2014, 09:56 AM
    Welfarelvr
    Re: Can You Discharge Capital Gains Taxes in Bankruptcy
    Quote:

    Quoting nch
    View Post
    My question involves bankruptcy in the state of: NH
    Our LLC has virtually no debt except mortgage and an SBA Guarantee on a grant, and we have no personal debt. We will proceed with a deed in lieu of foreclosure to clear the business. I understand we will be assessed capital gains tax on the 'gain' - is that dischargeable? That is really the major reason to file ch 7. i cant seem to get a straight answer anywhere. thanks.

    Taxes are generally not dischargable for three years.
  • 03-16-2014, 11:11 AM
    llworking
    Re: Can You Discharge Capital Gains Taxes in Bankruptcy
    Quote:

    Quoting nch
    View Post
    My question involves bankruptcy in the state of: NH
    Our LLC has virtually no debt except mortgage and an SBA Guarantee on a grant, and we have no personal debt. We will proceed with a deed in lieu of foreclosure to clear the business. I understand we will be assessed capital gains tax on the 'gain' - is that dischargeable? That is really the major reason to file ch 7. i cant seem to get a straight answer anywhere. thanks.

    Are you sure that you don't mean cancellation of debt income rather than capital gains? A deed in lieu would not necessarily result in any capital gain. It might very well result in a capital loss.
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