Internal Revenue Service v. Meyers (In re Meyers)

MEMORANDUM DECISION

At the time of filing their petition in bankruptcy on February 15, 1979, Earl R. Meyers and Karin E. Meyers (hereinafter referred to as Petitioners) were substantially indebted to the United States for past due and unpaid taxes of various types.

Claims were filed covering this tax liability both by the United States and petitioners pursuant to Rule 303 of the then applicable Bankruptcy Rules.

In issue here are two different tax claims:

The claim of the United States for income taxes due for the calendar year 1977, including penalties, in the amount of $7,287.36. These taxes, the parties concede, would have been entitled to priority over general unsecured creditors in the bankruptcy proceedings. For reasons that do not appear too clear from the record on appeal, Petitioners paid these taxes with property that would have otherwise been exempt from the jurisdiction and control of the bankruptcy court and its trustee.

In addition, Petitioners owe the United States F.I.C.A. and F.U.T.A. taxes totaling, with accrued interest, $3,653.88. These taxes the parties concede have not been paid, and that further, they too are entitled to priority over the general…