When it comes time to discharge 2019 taxes in bankruptcy, the IRS has laid a trap. The trap snaps shut three years (or 1095 days) from now. At that point, the familiar three year rule for tax dischargeability won’t be so simple. Between Covid, wildfires, and hurricanes, the IRS has unilaterally extended tax filing deadlines. […]
New California Homestead in Action
By Filed Under: Exemptions, Strictly California
The California homestead just changed, for the better, but it raised questions about how the single change affected the rest of the law. The newly enacted version of California Code of Civil Procedure 704.730 replaces the previous homestead system that pegged the amount of the available homestead to family relationships, including marriage, to age, or […]
Brace & Beyond: Joint Tenancy & Transmutation
By Filed Under: Real property
For Californians, the CA Supreme Court’s decision in Brace this summer upended our understanding of joint tenancy and community property. For decades, we “knew” that a property couldn’t be both joint tenancy and community property . Siberell. And for those of us in the 9th Circuit, we “knew” that when married folks acquired property with […]
Reasons Not To Prefer Business Bankruptcy
By Filed Under: Business bankruptcy
Preferences and the trustee’s ability to recover them have to be one of the hardest concepts to convey to bankruptcy clients. Clients gag at the thought that paying a genuine debt before a bankruptcy filing can expose the innocent recipient to suit. I was reminded of a further preference wrinkle in a corporate insolvency situation […]
Tax Audit Aftermath-Did You Tell The State?
By Filed Under: Tax
One of the bedrock requirements of the discharge of taxes in in bankruptcy is the requirement to have filed a return. No return, no discharge of that year’s taxes. But it gets more nuanced: in California, when the feds audit the debtor and change any of the elemental figures in a filed return return, the taxpayer […]
Sole Proprietorships In Chapter 7 In Trustee’s Cross Hairs
By Filed Under: Business bankruptcy
Why would a Chapter 7 trustee shut down a proprietorship business with no value? That question comes up again and again from newish bankruptcy lawyers who can’t imagine that a trustee would demand the closing of the debtor’s business. After all, goes the argument, the debtor needs to make a living and the business has […]
Assessing the Ailing Business Post Pandemic
By Filed Under: Business bankruptcy
Long after the human patients recover from the coronavirus, small businesses will still be ailing. And long nights will be spent deciding whether to try to stay in business. As bankruptcy lawyers, we’re going to see people in pain trying to assess what to do next. Business owners may see the exit heading through the […]
