IRS and CH13

[cvillag18]

On 1997 we filed Chapter 13 Bankruptcy and we completed the plan on 2002 and it was discharged. The main creditor was the Internal Revenue Service.

Recently the IRS started collection on taxes, interest and CIV penalties that were included in their Proof of Claim of our Chapter 13, which was paid under the plan. The IRS is claiming that some of the debt can not be discharged.

Any comments.

[HHM]

Civil penalties cannot be discharged, so if they weren't paid 100% in the chapter 13, then you might be hosed.

The thing is, there is "priority tax debt" and then there is "non-dischargeable" tax debt. In most cases, the two overlap so there is no issue. However, Civ Pens are non-discharegable & depending on the type of CivPen, non-priority. Thus, if your chapter 13 only paid "priority tax" debt, then its possible you didn't pay some of the other non-dischargeable tax debt.