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Converting Chapter 13 to Chapter 7

Minneapolis, MN |

I am currently in chapter 13 but recently accrued a huge tax debt from a loss in business, (LLC - partnership) which I cannot afford to pay right now. What will be the steps to convert this to chapter 7 and what are the implications of doing this? The chapter 13 is on me and my spouse, but the LLC has only 1 partner which is me.

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Attorney answers 5


Talk with the lawyer who is representing you in the ch 13 about this. There are several possible options for you. You may be able to stay in the ch 13 and work on an Offer-in-Compromise of the additional tax debt. You may be able to convert to ch 7 and then do an Offer-in-Compromise. You may be able to convert to a ch 7 and then file another ch 13. Or it may be desirable to dismiss your ch 13 and then file another one. If you need to find a bankruptcy lawyer to help you decide what to do, see the link to NACBA below for help in finding one.

Allan M. Darish

Allan M. Darish


Talking with your current attorney is the way to approach this. Depending on how far into your Chapter 13 plan you are, adding the new tax liability in some form and paying it may not be practical. Discharging taxes in particular requires some attention to details - not all taxes are dischargeable. Your attorney needs to get all the facts in order to tell you how best to approach this problem.


It appears you may face multiple options. You should sit down with the attorney who represents you in the present action so she/he can discuss the various possibilities with you.

MINNEAPOLIS/ST. PAUL/ST CLOUD/OUTLYING METRO. Do seek legal counsel for your personal legal issues and needs. This post is not legal advice and does not create an attorney-client relationship. This post is to be considered general information which may or may not apply to your personal situation.


I strongly suggest you speak to an experienced Bankruptcy Tax Attorney..there are a lot of bankruptcy attorneys, a lot of tax attorneys, but I believe very few good excellent bankruptcy tax attorneys..Do this BEFORE You do anything..They can go through with you the effect of you already being in a ch 13 also and why you don't want to keep filing repeated ch 13s as it will affect the dischargeabity deadlines to discharge income taxes. We are not sure of what type of taxes you owe by your question so you might want to change it to add on the years it is owed for, what type of tax, the amount, and when you filed and if you have ever filed bankruptcy also before and when and which chapter. Good luck.


All good advice. Assuming that you have an attorney in the 13 (which most do) that is your starting point, and that attorney should be familiar enough with your situation to give you better advice.


I agree with our colleagues, you definitely need to speak with your bankruptcy attorney, and if they are advanced they defiintely will go through for you all the options laid out of attorney Eli Larson's recommended alternatives.

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