Saturday, January 21, 2017

Mortgage payments cannon be discharged in a bankruptcy, when deeply interconnected with family support obligations.

In my consumer bankruptcy practice, I often encounter questions regarding the dischargeability of financial obligations. A person on the phone or face-to-face, usually at the first meeting or case evaluation, wants me to draw a quick conclusion and tell from a simplified fact pattern, if the debt is dischargeable or not. I am often pressed to decline a quick answer, unless I am presented with a full set of all relevant fact.

Just like in the case below, I was asked to research, if a mortgage obligation could be discharged, when a couple specifically agreed in the preceding divorce to maintain a house, to make the mortgage payments, and to allow their teenage kids to live there and attend their school district. I came across the case from the Bankruptcy Court in the Western District of Pennsylvania that addressed my issue head-on. Obligations to make mortgage payments and to pay child support coupled with physical placement of child in mortgaged property make the payments of the mortgage a non-dischargeable domestic support obligations. In re Price, No 15-07012-JAD, 2015 WL 9957177 (Bankr. W.D. Pa. Oct. 5, 2015)

Tuesday, January 10, 2017

New 2017 PA Tax Amnesty April 21, 2017- June 19, 2017.

From April 21, 2017 to June 19, 2017 the Department of Revenue will waive all penalties and half of the interest on eligible tax delinquencies for anyone who participates in the 2017 Tax Amnesty Program. 
One must file all missed tax returns and/or extensions to take advantage of the program. This will be one of the best opportunities in a while to take care of the missed or never-filed returns.
More details, including a brief explanatory video at the Department’s web-site at:

Monday, January 9, 2017

3 Cir: may not reduce "the amount of a tax lien to the value of the collateral securing the claim.”

Geisler v. IRS, A Chapter 7 debtor appealed dismissal of his adversary proceeding against the IRS. 

In his proceedings, he argued that the Service only had a claim to the extent of his owned property and absent an additional ground, excess should be void. The Court disagreed. 

Based its opinion on Dewsnup v. Timm, 502 U.S. 410, 419 (1992), it held that it was precluded in a Chapter 7 case from “reducing the amount of a tax lien to the value of the collateral securing the claim.”

Geisler v. IRS, 2016 U.S. App. LEXIS 14669 (3rd Cir. Aug. 10, 2016)