Type: Amicus
Date: July 7, 2014
Description: Whether late-filed taxes are dischargeable.
Result: Debtor lost, February 18, 2015
District Court Punts McCoy Issue
The District Court for the Middle District of Alabama kept the harsh McCoy rule alive while ultimately finding the debtor failed to file a tax “return” under the more lenient test set forth in Beard. In re Perry, No. 12-913 (Oct. 30, 2013). [Read more…] about District Court Punts McCoy Issue
District Court in Colorado Declines to Adopt McCoy Approach to Late-Filed Tax Returns
In In re Mallo, No. 13-98 (Sept. 11, 2013), and In re Martin, No. 12-3380 (Sept. 23, 2013), the District Court in Colorado was faced with determining under what circumstances a late-filed tax return, filed after the IRS had conducted its own assessment, could be deemed a “return” within the meaning of section 523(a)(1)(B)(i). [Read more…] about District Court in Colorado Declines to Adopt McCoy Approach to Late-Filed Tax Returns
McCoy: Are you out of your Vulcan mind?
No, we’re not talking about Spock and Dr. McCoy. We’re referring to the recent Fifth Circuit opinion in In re McCoy, 666 F.3d 924 (5th Cir. 2012), which held that a late-filed tax return is not a “return” for purposes of the Bankruptcy Code. The result is that a tax debt for which a late return was filed can never be discharged. This major departure from past practice is not warranted by either the plain language of the Code or the legislative history of BAPCPA, neither of which suggests that Congress intended to make tax debts related to late-filed returns non-dischargeable in all circumstances. Since McCoy was decided several bankruptcy courts have adopted a similar position.
NACBA member and tax expert Morgan King takes a closer look at this issue in his recent article “What’s Wrong with McCoy?” You can also follow the status of pending cases dealing with these issues at www.latefiledreturn.com.
NCBRC is interested in participating in cases dealing with this issue. To let us know about a pending case, please contact us at amicus.admin@nacba.org.