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Post Petition Tax Claims in Chapter 13

by Nicholas Ortiz, Boston Bankruptcy Attorney on October 15, 2007 · 0 comments · Posted in *Chapter 13 Bankruptcy, Tax Issues In Bankruptcy

A taxing authority has a special right to file a claims for postpetition taxes under 11 U.S.C. § 1305(a). Such a claim is allowed and entitled to priority unless a debtor successfully object to it.

A taxing authority will not always file a claim for postpetition taxes if a debtor is making payments outside the plan. However, when faced with a claim for taxes that become payable while a case is pending it is often necessary to file a motion under 11 U.S.C. § 1329 to modify the plan in order to provide for the postpetition tax claim. One reason for this is because the confirmation order of the original plan may set out a minimum percentage for general unsecured creditors which will not be met once the new tax claim is in the mix.

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