Before Ruth Heffron passed away in 2001, she named her daughter, Heidi Heffron-Clark, as the beneficiary of her individual retirement account (“IRA”). What seemed like a simple part of Ruth’s estate planning resulted in a U.S. Supreme Court decision that would cause many to reconsider how to address IRA beneficiary designations for creditor protection purposes.
Facing the imminent bankruptcy of the federal Highway Trust Fund (the “HTF”) and the specter of delays and reductions in payments from the HTF to the States, the US Congress last week passed the Highway and Transportation Funding Act of 2014, which extended federal surface transportation programs and funding through May 2015. We summarize below the key elements of the Act.
In the world of bank holding company bankruptcies, often a dispute arises between the parent company and the FDIC (as receiver for parent’s failed bank subsidiary) over the ownership of the tax refunds issued to the bank’s consolidated group pursuant to a consolidated tax return.
In re Joan Fabrics Corp., 508 B.R. 881 (Bankr. D. Del. 2014) –
The buyer of assets in a bankruptcy sale sought to enforce its asset purchase agreement against a county that was seeking to collect personal property taxes arising prior to the sale by exercising a statutory lien on the property acquired by the buyer.
In its opinion in Clark v. Rameker, 573 U.S. ____ (2014), the United States Supreme Court ruled that inherited IRA accounts are not exempt under 11 U.S.C. § 522(b)(3)(C), and are subject to payment of creditor claims in a chapter 7 case.
The New Jersey Supreme Court, in In re: Princeton Office Park, L.P. v. Plymouth Park Tax Services, LLC, determined that under the Tax Sale Law, N.J.S.A. §§ 54:5-1 to -137, a purchaser of a tax sale certificate acquires a tax lien, not a lien securing the property owner's obligation to pay the amount owing to redeem the certificate.
Q: When is a retirement account not a retirement account?
A: When it's an inherited IRA and the owner is bankrupt.
Within one day of each other, the U.S. District Court for the District of Massachusetts (“District Court”) in Perkins v. Massachusetts Department of Revenue, 507 B.R. 45 (Mar. 7 2014), and the Bankruptcy Appellate Court for the First Circuit (“BAC”) in Gonzalez v. Massachusetts Department of Revenue, 506 B.R. 317 (Mar. 6, 2014), issued contrary appellate rulings as to whether tax liabilities in late-filed state tax returns are dis-chargeable under Chapter 7.
Can a foreign person exclude foreign-situs assets in determining insolvency exception to cancellation of indebtedness income?