Rochelle's Daily Wire

Bankruptcy Judge Russin declines to follow the Third Circuit and adopts the conclusion of bankruptcy courts holding that Sub S status is estate property.

Looking beyond the label assigned by the Affordable Care Act, three circuits have now held that failure to pay the ‘individual mandate’ for purchasing health insurance gave rise to a tax entitled to priority in bankruptcy.

The circuits are now split 3/1, with the majority finding a waiver of sovereign immunity under Section 544(b)(1) for lawsuits by a trustee based on claims that an actual creditor could not have brought outside of bankruptcy.

The Affordable Care Act’s ‘individual mandate’ was a tax measured by income, thus giving the IRS a priority tax claim.

A question may be headed to the Sixth Circuit, where debtors hope to create a circuit split.

The circuits are now split 2/1 on the waiver of sovereign immunity under Section 544(b) for lawsuits by a trustee based on claims that could have been made by an actual creditor.

A trustee can avoid and preserve a tax lien for the benefit of unsecured creditors, but a debtor can’t if the debtor hasn’t paid the taxes, the Ninth Circuit says.

The Tenth Circuit will likely take sides on a split between the Ninth and Seventh Circuits on Section 544(b) state-law claims brought by a trustee in the shoes of an actual creditor.

On an issue with no appellate authority, a Delaware district judge rules that federal income taxes are administrative claims if filing occurs before the year’s end.

The exaction for failure to purchase health insurance isn’t an excise tax ‘on a transaction’ under Section 507(a)(8)(E)(i).