Many taxes are not dischargeable in a Chapter 7 bankruptcy.  The taxes that aren't dischargeable are called priority taxes.  Priority taxes, generally speaking, involve (a) income taxes for returns filed less than three years ago,  (b) taxes assessed less than 240 days ago, trust fund taxes regarless of how old they are.

However, in Chapter 13, your taxes can be restructured so that you can afford to pay them over time.  This enables most people to get out from under their IRS debt within five years -- something that might not be possible if high interest and penalties were to continue to accrue.  It also enables you to avoid IRS levies on your income and property.

In addition to stopping IRS levies and restructuring tax debts, you can save thousands of dollars in interest and penalties through a Chapter 13 bankruptcy in Colorado.  If a tax lien is already in place, you can file bankruptcy to prevent the IRS from renewing the tax lien when it expires.

Some income taxes can be eliminated entirely in a Chapter 7 bankruptcy.  Determining dischargeability of taxes is a complicated matter.  The taxes must be non-priority taxes.  At the risk of oversimplification one can say -- in general -- that non-priority taxes are(a) income taxes for returns filed more than three years ago, (b) taxes assessed more than 240 days ago, and (c) taxes that are not trust fund taxes (employee income withholding taxes for business owners).

Chapter 13 bankruptcy cases are almost always much less expense that hiring a CPA or tax lawyer to negotiate an Offer in Comprose.  Chapter 13 is usually thousands of dollars less expensive.  Your up-front costs is about the same as filing a Chapter 7 bankruptcy.