The Cline Law Group recently won a big victory in the US Circuit Court of Appeals.
Please read the following summary:
In what is being hailed by many as a victory for debtors who owe taxes, attorney Melanie Tavare of the Cline Law Group, won a complex tax dischargability case in the Ninth Circuit Court of Appeals against the California Franchise Tax Board. This dedication to clients is what makes The Cline Law Group the best choice for your bankruptcy needs.
Case Name: California Franchise Tax Board v.Kendall, Trustee (In re In re Brenda M. Jones), 21 CBN 1004. 2011 WL 2685582 (9th Cir. 07/12/11).
Facts: The Debtor and her husband filed a joint voluntary Chapter 13 bankruptcy petition in July 2002. The bankruptcy court confirmed the Debtors' plan in September 2002. The Debtors' filed their joint income tax return for the year 2002 in October 2003, pursuant to an extension, but they did not pay the approximately
$6,000 they owed in reported taxes. The bankruptcy court dismissed the Debtors' Chapter 13 proceeding in September 2006.Thirteen months later, in October 2007, the Debtor, but not her husband, filed a voluntary Chapter 7 bankruptcy petition. She received a discharge of her existing debts. In 2009, the FTB successfully moved to reopen the Debtor's Chapter 7 case before the bankruptcy court and requested a determination that the tax debt was excepted from discharge.
Ruling: The 9th U.S. Circuit Court of Appeals affirmed the lower court's ruling that the debtor's taxes were discharged.
Summary: When the bankruptcy court confirmed the Debtors'Chapter 13 plan, the estate property revested in the Debtor and became the Debtor's property, thus lifting the applicable stay provisions. Since this revesting occurred before the tax debt came due, no stay precluded the FTB from collecting on the debt under § 362. Consequently, the tax debt was not excepted from the Chapter 7 discharge.
