Discussion:Taxpayer in Ch 7 Bankruptcy

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Ftax (talk|edits) said:

18 January 2006
I have a taxpayer that started a small business at the beginning of 2004. He operated the business until mid 2005, when he filed Ch 7. He has not filed a return for 2004. The operating losses he incurred in 2004 will result in a full refund of his withheld taxes for 2004.

Am I correct in my understanding as follows:

1-A 1041 (Estate) return will be filed by the Bankruptcy Trustee for all income/assets taken into the Bankruptcy Estate.

2-The Taxpayer is entitled to file his personal returns for 2004 and receive the full refund.

3-Taxpayer will attach 1041 prepared by Bankruptcy Trustee to his 2005 return (1040) which will include any non-bankruptcy income.

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