Payroll Taxes are comprised of two parts:
Trust fund, which is the taxes collected by the employer and withheld from employees
Non-trust fund, which is the employer payroll tax obligation
Only the employer non-trust fund payroll tax and accrued penalty and interest can be discharged in bankruptcy. An exception to this rule is when someone is considered personally liable and assessed for the trust fund recovery.
After taxes are discharged, certain exempt assets (i.e. equity in home, automobile, accounts receivable) to which the court does not attach are still subject to a Notice of Federal Tax Lien if the IRS filed prior to the bankruptcy.