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Nondischargeable debt under 523(a)(14)
I had this issues years ago. It's basically re-characterizing the debt. They actually look at that stuff, remember it on Student Loans.
Charles Shamash, Esq.
Caceres & Shamash, LLP
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Dear Jim,
Great to see you at the cdcbaa dinner. Now to your question:
I have had clients with relatively small credit card charges (say, several hundred) incurred to pay taxes and have never faced a 523(a)(14) adversary. (In fact, the only 523 adversaries I ever get are based on some combination of (a)(2), (4), and (6).) Moreover, none of the those clients have told me that the creditor attempted to collect the debt after discharge.
My guess is that the key factor is the passage of time (though a sufficiently large tax charge may get the creditor's attention). For example, if the tax charge was incurred a couple of years prior to filing, the credit card company - whether AmEx, or some other dark side of the force entity - will probably not try to collect because its corporate memory is short. Thus, when enough time has passed the creditor doesn't have a detailed list of the charges in its readily available records, doesn't know that one of the charges was incurred to pay a tax, and just writes the whole amount off after the discharge. On the other hand, if the charge was a couple of months ago, the creditor may pay attention and attempt postdischarge collection. What the time cut-off is is anybody's guess, and undoubtedly varies from creditor to creditor.
My suggestion is to age the debt for a while, unless your client has an 800 pound foreclosure gorilla, or some other monster, banging at the door.
Finally, since 523(c) only includes 523(a)(2), (4), and (6) within its ambit, the debt is presumptively nondischargeable without the adversary. Moreover, if AmEx wants to file a nondischargeability adversary, it doesn't have any time limitation because of Fed. R. Bankr. Proc. 4007(b).
Good luck,
Nick
Nicholas Gebelt, Ph.D., J.D.
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Jim:
They have hired a new computer guru, given him 300,000 files and asked him to search for such things.
I sat next to him on a flight back from Hawaii.
Direct Experience: One creditor filed a 523 and had the a14 claim as one cause of action, but that is my only experience with someone suing on the basis of a14.
Unless the creditor is doing a computer search, they probably won't find it, but my belief is that AX hired the guy.
He was crowing about how many of these he can catch, and how much he can save these credit card issuers. I told him he will just help me pay off my mortgage early, as more and more debtors will have to defend 523's.
d
________________________________
To: "cdcbaa@yahoogroups.com"
Sent: Monday, November 19, 2012 3:08 PM
Subject: [cdcbaa] RE: Nondischargeable debt under 523(a)(14)
Hello colleagues. Our client has a large AmEx credit card charge to the IRS to pay an estimated income tax payment. This debt is nondischargeable under Section 523(a)(14). But that type of nondischargeable debt is not one of those which requires a Complaint under 523(c)(1). Would you expect AmEx to file a timely Complaint to Determine Dischargeability of Debt? If they didnt, would you expect them to try to enforce the debt post-discharge? Has anyone else had recent experience with a 523(a)(14) debt?
Jim
James R. Selth
Certified Bankruptcy Specialist*
Weintraub & Selth, APC
11766 Wilshire Boulevard, Suite 1170
Los Angeles, California 90025
Telephone: (310) 207-1494
Facsimile: (310) 442-0660
E-Mail: jim@wsrlaw.net
*Certified by State Bar of California as Certified Legal Specialist in Bankruptcy Law
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I had this case about 5 years ago. My client paid his property taxes with
AmEx five months before filing. AmEx contacted me within a few weeks of the
filing. We negotiated and settled for payments but they insisted on filing
a nondischargeability complaint and we filed a stipulation for settlement.
Stella
The post was migrated from Yahoo.
Hello colleagues. Our client has a large AmEx credit card charge to the IRS to pay an estimated income tax payment. This debt is nondischargeable under Section 523(a)(14). But that type of nondischargeable debt is not one of those which requires a Complaint under 523(c)(1). Would you expect AmEx to file a timely Complaint to Determine Dischargeability of Debt? If they didn't, would you expect them to try to enforce the debt post-discharge? Has anyone else had recent experience with a 523(a)(14) debt?
Jim
James R. Selth
Certified Bankruptcy Specialist*
Weintraub & Selth, APC
11766 Wilshire Boulevard, Suite 1170
Los Angeles, California 90025
Telephone: (310) 207-1494
Facsimile: (310) 442-0660
E-Mail: jim@wsrlaw.net
*Certified by State Bar of California as Certified Legal Specialist in Bankruptcy Law
The post was migrated from Yahoo.