Guidance Regarding Tax Information Under 11 U.S.C. § 521
In several recent cases, attorneys for individual debtors filed copies of debtors’ prepetition income tax returns with the Petition or as a separate document. These filings are based on a misunderstanding of section 521(e) and (f), as amended by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (“BAPCPA”). Section 521(e) requires a debtor to provide to the trustee (and to any creditor who asks) at least a week before the § 341 meeting that debtor’s tax return “for the most recent tax year ending immediately before the commencement of the case and for which a Federal income tax return was filed.” Section 521(e) does NOT require filing of that prepetition return with the Court, and filing such a return does NOT satisfy section 521(e). Filing such a return is unnecessary.
Section 521(f) does NOT require a debtor to file tax returns UNLESS the court, a trustee, a creditor or other party in interest makes a written demand on the debtor to do so. Moreover, this subsection is concerned only with those tax returns that a debtor files AFTER the petition date while the case is pending (which could be for a prepetition tax year, as well as for later tax years).
Finally, some of the unnecessarily filed prepetition tax returns were not redacted for personal identifiers, such as social security numbers and names of minor children. Privacy concerns make it imperative that attorneys carefully review any return about to be filed with the Court to make certain that personal identifiers have been blocked out. Guidance on what personal identifiers should be removed can be found in a memorandum from the Director of the Administrative Office of the United States Courts posted on the home page of our website (www.ganb.uscourts.gov); click on "1. Bankruptcy Abuse Prevention and Consumer Protection Act of 2005." In addition to the Director's memo, you will find other helpful information concerning changes made by BAPCPA.
Pursuant to section 315(c) of BAPCPA, the Director of the Administrative Office of the United States Courts has published Guidance with respect to procedures for filing tax information and for requesting access to such information pursuant to section 521 of the Bankruptcy Code. The procedures described are subject to more detailed procedures that the Court may adopt at a later date.