A taxpayer filed Chapter 13 Bankruptcy on December 7, 2019. We had placed a DMV Stop on the taxpayer for delinquent taxes/citations. The taxpayer did not list the City as a creditor in the bankruptcy. Are we required to remove the DMV Stop?

The automatic stay prevents any collection action against the debtor, which would include imposing a DMV stop. It doesn’t matter that you didn’t get notice of the bankruptcy as the automatic stay still applies.

If the DMV hold is just sitting there, you are really not taking any collection action; however, should the person need to renew their tags while they are in bankruptcy, you would have to release the stop due to the bankruptcy case. That release can be reported back to DMV as a bankruptcy release and no fee will be charged.