Chapter 13 Debtors Should Include Proposal to Surrender Tangible Property to Pay Secured Tax Claim According to Latest ABI Poll
Chapter 13 Debtors Should Include Proposal to Surrender Tangible Property to Pay Secured Tax Claim According to Latest ABI Poll
Contact: John Hartgen
703-739-0800
[email protected]
CHAPTER 13 DEBTORS SHOULD INCLUDE PROPOSAL TO SURRENDER TANGIBLE
PROPERTY TO PAY SECURED TAX CLAIM, ACCORDING TO LATEST
September 26, 2007,
Alexandria, Va. —A majority of respondents (62 percent)
to
Twenty-four percent of respondents, however, did not agree that debtors should include a proposal to surrender tangible property to pay a secured tax claim and the remaining secured value through their chapter 13 plan. Seventeen percent “strongly disagreed” and 7 percent “somewhat disagreed” that debtors should include a proposal to surrender tangible property to pay the remaining value of a secured tax claim and the remaining secured value through their chapter 13 plan. Twelve percent of the respondents did not know or had no opinion on the issue.
The U.S. Court of Appeals for the Fourth Circuit affirmed a district court’s ruling in IRS v. White, (4th Cir. No. 06-1462, 4/23/07), in which the chapter 13 debtors had not properly included a proposal to surrender tangible property and pay the remaining value of a secured tax claim in their reorganization plan. The court found that while the debtors had proposed to “surrender” tangible property, they were not planning to relinquish the property in a timely or proper manner to satisfy the claim.
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