Discharge Of Taxes In Bankruptcy

The thousands of mergers, acquisitions, and start-ups that have characterized the past ten years of business have created an increasing number of corporations in financial trouble: specifically, a shortage of venture capital or quick cash. Consequently, bankruptcy protection is now viewed as a strategic move to protect corporations from their creditors and allow them to reorganize. Bankruptcy and Insolvency Taxation, Third Edition provides the answers to the questions financial managers will have on the tax aspects of the "bankruptcy strategy."

This publication isn't intended to cover bankruptcy law in general, or to provide detailed discussions of the tax rules for the more complex corporate bankruptcy reorganizations or other highly technical transactions. Additionally, this publication isn't updated on an annual basis and may not reflect recent developments in bankruptcy or tax law. If you need more guidance on the bankruptcy or tax laws applicable to your case, you should seek professional advice. This publication explains the basic federal income tax aspects of bankruptcy. A fundamental goal of the bankruptcy laws enacted by Congress is to give an honest debtor a financial "fresh start". This is accomplished through the bankruptcy discharge, which is a permanent injunction (court-ordered prohibition) against the collection of certain debts as a personal liability of the debtor. Bankruptcy proceedings begin with the filing of either a voluntary petition in the United States Bankruptcy Court, or in certain cases an involuntary petition filed by creditors.