In Re: Robin L. Johnston, Debtor. Robin L. Johnston v. Thomas HazlettIn Re: Robin L. Johnston, Debtor. Robin L. Johnston v. Thomas Hazlett
OPINION
Dеbtor-Appellant Robin L. Johnston appeals the decision of the Bankruptcy Appellate Panel affirming the Bankruptcy Court’s denial of her claim that her 1997 earned income tax credit (“EIC”) is exеmpt from inclusion in her Chapter 7 bankruptcy estate. For the reasons that follow, we affirm the decision of the Bankruptcy Appellate Panel.
I.
On October 20, 1997, Robin L. Johnston filed a voluntary petition fоr relief under Chapter 7 of the United States Bankruptcy Code. Johnston listed ip her petition for relief a 1997 EIC in the amount of $2,000 and claimed the entire amount as an exemption. The Bankruptcy Court sustainеd the Trustee’s objection to the exemption, rejecting Johnston’s argument that because she had no “legal or equitable interest” in the EIC at the time she filed her petition, the EIC cannot be defined as property of the estate under
Johnston raises three assignments of error on appeal: (1) because she was not entitled to the EIC until thе end of the tax year, she had neither a legal nor an equitable interest in the EIC at the time she filed hеr petition, and therefore, it was not part of the bankruptcy estate; (2) the opt-out provision of
II.
Whether the EIC was properly included as property of the bankruptcy estate is purely an issue of law. We review a bankruptcy court’s сonclusions of law de novo.
Nicholson v. Isaacman (In re Isaacman),
The overwhelming majority of courts confronted with this issue have rejected the argument that Johnston makes here.
2
In
Baer v. Montgomery (In re Montgomery),
The Bankruptcy Act was repealed in favor of the modern Bankruptcy Code by the Bankruptcy Reform Act of 1978. Though the “fresh start” maxim rising from section 70a(5) of the Aсt may have been a fundamental consideration in the formation of the Code, we recognizе the maxim to be a limited, and no longer a completely unencumbered, guiding principle. Unlike the Act, the Code requires that all property of the debtor, whether or not exempt, be included in the bankruptcy estate, mandating that an estate in bankruptcy comprise “all legal or equitable intеrests of the debtor in property as of the commencement of the case.”11 U.S.C. § 541(a)(1) (1994). Legislative history indicatessection 541 is intended to bе given a broad definition to include “all kinds of property, including tangible or intangible property, causes of action ..., and all other forms of property specified in section 70a of the Bankruptcy Act.... [I]t includes as property of the estate all property of the debtor, even that needed for a fresh start.” H.R.Rep. No. 95-595, at 367 (1977). Any conclusion that EICs are necessary or mandatory for a “fresh start” may be reasonably inferred under the Act, but is incorrect in light of the Code.
Montgomery,
In the case before us here, the Bankruptcy Appellate Panel reviewed the reasoning and conclusions of
Montgomery
and concluded,
“Montgomery
also held that EICs are property of the estate under
We agree with the - Bankruptcy Appellate Panel that the reasoning of the Montgomery рanel is correct. Accordingly, we hold that in the case before us here, the bankruptcy court and appellate panel properly determined that Johnston’s EIC was property of thе bankruptcy estate, despite the fact that Johnston filed her bankruptcy petition prior to thе end of the tax year in which the credit was earned.
CONCLUSION
The decision of the Bankruptcy Appellate Panel affirming the judgment of the Bankruptcy Court is AFFIRMED.
Notes
. Issues not raised before the trial court are generally considered waived.
See White v. Anchor Motor Freight, Inc.,
.
See, e.g., Baer v. Montgomery (In re Montgomery),