Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2016
Sales and Use Tax Annotations
170.0000 COLLECTION OF TAX BY BOARD
(a) IN GENERAL
170.0007.185 Filing of Bankruptcy While Petition for Redetermination Pending. A Notice of Determination was issued to a taxpayer on October 9, 1991. A timely petition for redetermination was filed on October 28, 1991. While the petition was pending, the taxpayer filed Chapter 7 bankruptcy on March 17, 1992. The no asset case was closed on June 4, 1992.
Liabilities which do not become "due and payable" prior to a taxpayer's Chapter 7 bankruptcy filing because the taxpayer avails itself of its statutory right to an administrative review of the liability will not be subject to discharge. The bankruptcy code permits a tax agency a designated period of time to collect a tax liability before the tax liability will be subject to discharge in a taxpayer's Chapter 7 bankruptcy action. Since the tax liability did not become "final" (and thus collectible by the Board) prior to the taxpayer's bankruptcy filing, the liability was not discharged in the taxpayer's bankruptcy action. 8/4/97. (M98-3).