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Taxes: How to get Trustee disbursements applied first to priority taxes
No. The payment is on the prepetition claim. It can be applied to the prepetition claim.
Dennis McGoldrick
350 S. Crenshaw Bl., #A207B
Torrance, CA 90503
On Jun 25, 2010, at 3:40 PM, "Steven B. Lever" wrote:
Are they income taxes? If thats the case, wouldnt the non-priority taxes be discharged, forcing the IRS to apply them to the priority taxes?
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It takes a designated payment to force the IRS to apply the payment to a particular tax. Trustee has no business designating to the IRS which claim is being paid. IRS usually applies new money against oldest tax owed.
Dennis McGoldrick
350 S. Crenshaw Bl., #A207B
Torrance, CA 90503
On Jun 25, 2010, at 6:15 PM, "Steven B. Lever" wrote:
Right, that is true if theres enough money, regardless of the discharge. So, if that happened there would have to be more money than sufficient to pay the priority claims, and then the IRS would have to apply the monies received to the non-dischargeable taxes. This scenario is good because the Chapter 7 Trustee will pay the priority claims as filed in the Proof of Claim filed by the IRS, but interest and penalties will continue to accrue on the priority portion. The monies received from dischargeable/non-priority years from the Chapter 7 Trustee will first be credited by the IRS against those postpetition priority interest and penalties that have accrued. This is due to the discharge injunction. At least I think thats how it would work, but John Faucher knows better than me.
The post was migrated from Yahoo.
Right, that is true if there's enough money, regardless of the
discharge. So, if that happened there would have to be more money than
sufficient to pay the priority claims, and then the IRS would have to
apply the monies received to the non-dischargeable taxes. This scenario
is good because the Chapter 7 Trustee will pay the priority claims as
filed in the Proof of Claim filed by the IRS, but interest and penalties
will continue to accrue on the priority portion. The monies received
from dischargeable/non-priority years from the Chapter 7 Trustee will
first be credited by the IRS against those postpetition priority
interest and penalties that have accrued. This is due to the discharge
injunction. At least I think that's how it would work, but John Faucher
knows better than me.
The post was migrated from Yahoo.