[CLBS] Tax questions

[Patrick J. Geile]

I have an odd fact scenario

Debtor is entitled to receive a 30K refund.  The estates portion would be 25% based on when the Debtor filed.  Prior to sending the funds to the estate, the IRS offset its valid priority claim of 12K.

The estate is now claiming 25% of the 18K it received from the IRS.  The debtor argues that the IRS already took the estate's portion prior to sending to the trustee and therefore should be entitled to at least all the 18K, and in fact should get an additional $4500 from the estate.  The estate has that much cash on hand.

Not surprisingly I agree with the debtor.  Has anyone had a case like this or moved for the IRS to turnover the full refund?

Patrick J. Geile
Foley Freeman PLLC
953 S. Industry Way, Meridian, Idaho 83642
P.O. Box 10
Meridian, Idaho 83642
Direct line: (208) 947-1563
Phone:  (208) 888-9111
Fax:  (208) 888-5130