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  1. #1
    Join Date
    Mar 2014
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    1

    Default 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.

  2. #2
    Join Date
    Sep 2013
    Posts
    833

    Default Re: Can You Discharge Capital Gains Taxes in Bankruptcy

    Quote Quoting nch
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    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.

  3. #3
    Join Date
    Oct 2006
    Posts
    16,474

    Default 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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