670 F.3d 699
6th Cir.2012Background
- Hight filed a voluntary Chapter 13 petition January 28, 2009, and a plan February 4, 2009.
- Hight’s 2008 Michigan state income tax return showed a $4,900 liability due April 15, 2009, which she did not pay.
- On July 17, 2009, Hight filed a protective proof-of-claim on behalf of the Michigan Treasury for the 2008 tax debt.
- Treasury objected, arguing § 1305 limits postpetition claims to creditors filing the claim, not debtors filing on their behalf.
- Bankruptcy court overruled Treasury; district court affirmed, holding § 502(i), § 507(a)(8), and § 1322(a)(2) permit treating the claim as prepetition.
- This court must determine if Hight could file such a protective claim under § 501(c) and § 502(i) despite § 1305.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether debtor may file a protective tax claim under § 501(c) and § 502(i). | Hight allowed by § 501(c) to file on Treasury's behalf. | § 1305 prohibits debtor-from-filing on creditor’s behalf. | Yes; protective claim permitted under § 501(c) and § 502(i). |
| Whether § 502(i) applies to a postpetition tax claim that is priority under § 507(a)(8). | Tax debt qualifies under § 507(a)(8) and may be treated as prepetition. | Treasury argues the tax is not within § 507(a)(8) lookback. | Yes; the 2008 tax debt falls within § 507(a)(8) and is treated as prepetition under § 502(i). |
| Interpretation of the phrase ‘after three years before’ in § 507(a)(8)(A)(i). | The phrase includes taxes due after the lookback date, including post-petition, for applicability. | A narrow reading excludes post-petition due dates. | This court adopts the broader reading; the provision includes post-petition due dates for lookback purposes. |
| Whether Hight’s 2008 tax debt qualifies under § 507(a)(8)(iii) as other income tax not precluded by § 523. | Debt is assessable after case commencement and thus priority under § 507(a)(8)(iii). | Tax type may fall under other categories; Treasury disputes priority. | Yes; it qualifies under § 507(a)(8)(iii) as other income tax assessable after commencement. |
| Whether recognizing postpetition claims as prepetition affects § 1305’s permissive filing. | Does not render § 1305 a nullity; some postpetition taxes may be treated as prepetition. | Permissive § 1305 becomes meaningless if many postpetition claims are treated as prepetition. | Interpretation is consistent; § 1305 remains a permissive option for taxes not within § 502(i) treatment. |
Key Cases Cited
- In re Flores, 270 B.R. 203 (Bankr. S.D. Tex. 2001) (permits debtor filing of postpetition claims under § 501(c) when authorized elsewhere)
- In re Senczyszyn, 426 B.R. 250 (Bankr. E.D. Mich. 2010) (supports debtor filing on creditor’s behalf under § 501(c) and § 502(i))
- Nat’l Air Traffic Controllers Ass’n v. Sec’y of Dep’t of Transp., 654 F.3d 654 (6th Cir. 2011) (avoid inconsistent construction of related provisions)
- In re Dixon, 218 B.R. 150 (B.A.P. 10th Cir. 1998) (interpretation of ‘after three years before’ phrase)
- Young v. United States, 535 U.S. 43 (2002) (clarifies lookback for § 507(a)(8)(A)(i) in context of earlier issue)