Taxes: How to get Trustee disbursements applied
Posted: Mon Jun 28, 2010 8:17 am
You have no choice on application unless Plan requires otherwise. These are
involuntary payments - IRS chooses application.
David A. Tilem
Certified Bankruptcy Specialist*
Law Offices of David A. Tilem (a debt relief agency)
206 N. Jackson Street, #201, Glendale, CA 91206
Tel: 818-507-6000 Fax: 818-507-6800
* Bankruptcy specialist cert. by State Bar of CA Bd of Legal
Specialization.
Mark J. Markus
Sent: Saturday, June 26, 2010 6:45 PM
To: cdcbaa@yahoogroups.com
Subject: Re: [cdcbaa] Re: Taxes: How to get Trustee disbursements applied
first to pri...
But that's how it gets DISBURSED...not how the creditor has to apply it,
right? Or are you saying I can argue based on the bankruptcy code that the
payment the Trustee made was for secured or priority and, therefore, must be
applied as such?
Maybe I'm missing something here.
On 6/26/2010 6:23 PM, robert90701@ aol.com
wrote:
Payments received through the bankruptcy proceeding are applied as follows
First to liabilities listed as secured; Then to unsecured priority; and
Lastly, to the claim's unsecured general class unless 1) a court order
2)confirmed plan states to contrary or
3) in governments best interest to do otherwise.
Disclaimer
Although the above response is believed to be accurate, it should not be
relied upon as any type of legal advice. It is intended to educate the
reader and a more definite answer should be based on a consultation with a
lawyer. No attorney client relation is formed with me without a written
contract.
Good Luck starts with a strategy and a plan.
Robert J. Suhajda, MS,CPA
Attorney
17721 Norwalk Blvd. #43
Artesia, CA 90701
562-924-8922
Former financial auditor and controller. Admitted to US Tax Court, Income
Tax, Bankruptcy, IRS representation, Fiduciary income tax returns, Estate
and Gift tax returns
In a message dated 6/26/2010 5:10:23 P.M. Pacific Daylight Time,
bklawr@yahoo. com writes:
Thanks, Jeff. I don't see how that would help. I can get the Trustee to
"designate" if that would help. But I think Dennis said that even if I can
get the Trustee to specify what it is being paid for, then that won't result
in the IRS applying it the way we want. Sounds like this is purely up to
the IRS, unless anyone has different experience.
On 6/26/2010 3:17 PM, Jeffery B Smith wrote:
Mark:
Would it help, since you are filing the claims, to file separate claims for
each category? Identify the secured claims and file a POC that explains the
basis for the secured status. Then file a POC for the unsecured priority
claims, if there are some that exceed the collateral, and take the time to
explain the basis of that designation. If anything is left, file a third
POC designating the balance as unsecured, non-priority claims. When the
Trustee goes to pay claims he will list them as such on his final report,
which must be approved by the court and, if I recall, the COURT issues an
ORDER approving the distribution, by claim. After the case is closed, you
and I both know that the IRS will claim to have applied the payments some
other way, and claim the taxes that were paid were the unsecured
non-priority taxes. So, the IRS will move later (post-discharge) to levy or
garnish. THEN, you have to re-open the case, and ask for an injunction.
But you will get it if the final report and order are clear. I hope you
have a good trustee who appreciates you bringing him/her an asset case, and
cooperating with the administration of that case. If you work with, and not
against the trustee, and explain what you want to accomplish, my experience
is that they will help you by making the final report VERY clear about what
is being paid for what.
The key to this is that you said YOU will file the claims for the IRS. Its
gonna get tricky if the IRS files their own claims later. Then you might
have to object to their claims to make sure they have correctly categorized
each claim as secured/unsecured, and then priority/non priority. Very
tricky, but I think you can do it. Good luck! P.S. Had fun on the course
at the tourney with you a few weeks ago!
-Jeffrey B. Smith**
CURD, GALINDO & SMITH, L.L.P.
301 East Ocean Blvd. #1700
Long Beach, CA 90802
(562) 624-1177
(562) 624-1178 fax
(310) 993-6560 cellular
www.expertbk. com
**Certified By The State Bar
Of California As A Specialist
In Bankruptcy Law
Message
You have no choice on
application unless Plan requires otherwise. These are involuntary payments
- IRS chooses application.
David A.
Tilem
Certified Bankruptcy
Specialist*
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