October Term 2011 · Docket 10-875
Who pays post-bankruptcy income taxes?
The dispute centers on whether a debtor or the estate pays income taxes generated after filing.
Verified source milestones
- — An official oral-argument transcript was verified.
The arguments, in order
This case may have been argued more than once. Each entry below uses that session's official transcript. Later arguments do not erase earlier ones.
Argument 1 ·
What happened at the argument
Ms. Freeman argued bankruptcy estates incur taxes when they generate income.
Mr. Shah argued postpetition tax liabilities are not subject to discharge.
Justice Kennedy asked about debts incurred after the filing date.
Justice Sotomayor noted the debtor is going to pay.
Read the official transcript for this argument · Official argument details
Sources used for this argument breakdown
- Official Supreme Court Transcript — file page 10, lines 8-46 — Transcript, file page 10, lines 8-46
- Official Supreme Court Transcript — file page 27, lines 30-10 — Transcript, file page 27, lines 30-10
- Official Supreme Court Transcript — file page 3, lines 20-50 — Transcript, file page 3, lines 20-50
- Official Supreme Court Transcript — file page 3, lines 52-4 — Transcript, file page 3, lines 52-4
- Official Supreme Court Transcript — file page 3, lines 8-18 — Transcript, file page 3, lines 8-18
- Official Supreme Court Transcript — file page 4, lines 14-16 — Transcript, file page 4, lines 14-16
- Official Supreme Court Transcript — file page 4, lines 32-32 — Transcript, file page 4, lines 32-32
- Official Supreme Court Transcript — file page 4, lines 38-40 — Transcript, file page 4, lines 38-40
- Official Supreme Court Transcript — file page 5, lines 26-30 — Transcript, file page 5, lines 26-30
- Official Supreme Court Transcript — file page 6, lines 10-12 — Transcript, file page 6, lines 10-12
- Official Supreme Court Transcript — file page 6, lines 20-28 — Transcript, file page 6, lines 20-28
- Official Supreme Court Transcript — file page 7, lines 26-28 — Transcript, file page 7, lines 26-28
- Official Supreme Court Transcript — file page 8, lines 14-28 — Transcript, file page 8, lines 14-28
- Official Supreme Court Transcript — file page 8, lines 36-38 — Transcript, file page 8, lines 36-38
- Official Supreme Court Transcript — file page 9, lines 16-22 — Transcript, file page 9, lines 16-22
A citizen's guide to the whole case
What this case is about
This case examines who owes income taxes created after a bankruptcy filing. the sides that brought the case argue the estate should pay. The government argues the debtor must pay. The Court seeks clarity on this financial responsibility.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 30-10 — Transcript, file page 27, lines 30-10
- Official Supreme Court Transcript — file page 3, lines 20-50 — Transcript, file page 3, lines 20-50
How the case got here
The Supreme Court heard oral argument in this case on November 29, 2011.
Official sources for this section
- Official Supreme Court Transcript — file page 3, lines 8-18 — Transcript, file page 3, lines 8-18
What each side wants
the sides that brought the case want the estate to pay the postpetition income taxes.
The government wants the debtor to pay the postpetition income taxes.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 30-10 — Transcript, file page 27, lines 30-10
- Official Supreme Court Transcript — file page 3, lines 20-50 — Transcript, file page 3, lines 20-50
What each side says
the sides that brought the case argue postpetition tax liabilities are not dischargeable nonpriority debts.
The government argues the debtor remains liable for taxes incurred after filing.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 30-10 — Transcript, file page 27, lines 30-10
- Official Supreme Court Transcript — file page 3, lines 20-50 — Transcript, file page 3, lines 20-50
What the justices asked
Justice Alito asked who files the state tax return.
Justice Ginsburg asked if the rule applies to state taxes.
Official sources for this section
- Official Supreme Court Transcript — file page 10, lines 8-46 — Transcript, file page 10, lines 8-46
- Official Supreme Court Transcript — file page 3, lines 52-4 — Transcript, file page 3, lines 52-4
- Official Supreme Court Transcript — file page 4, lines 14-16 — Transcript, file page 4, lines 14-16
- Official Supreme Court Transcript — file page 4, lines 32-32 — Transcript, file page 4, lines 32-32
- Official Supreme Court Transcript — file page 4, lines 38-40 — Transcript, file page 4, lines 38-40
- Official Supreme Court Transcript — file page 5, lines 26-30 — Transcript, file page 5, lines 26-30
- Official Supreme Court Transcript — file page 6, lines 10-12 — Transcript, file page 6, lines 10-12
- Official Supreme Court Transcript — file page 6, lines 20-28 — Transcript, file page 6, lines 20-28
- Official Supreme Court Transcript — file page 7, lines 26-28 — Transcript, file page 7, lines 26-28
- Official Supreme Court Transcript — file page 8, lines 14-28 — Transcript, file page 8, lines 14-28
- Official Supreme Court Transcript — file page 8, lines 36-38 — Transcript, file page 8, lines 36-38
- Official Supreme Court Transcript — file page 9, lines 16-22 — Transcript, file page 9, lines 16-22
Why it matters
This issue determines who bears the cost of post-bankruptcy income. It affects the financial burden on debtors and estates. It clarifies the allocation of tax liabilities in bankruptcy proceedings.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 30-10 — Transcript, file page 27, lines 30-10
- Official Supreme Court Transcript — file page 3, lines 20-50 — Transcript, file page 3, lines 20-50
What happens next
This article currently covers the argument record. Use the official docket link for later case activity.
Official sources for this section
- Official Supreme Court Transcript — file page 10, lines 8-46 — Transcript, file page 10, lines 8-46
- Official Supreme Court Transcript — file page 3, lines 52-4 — Transcript, file page 3, lines 52-4
- Official Supreme Court Transcript — file page 3, lines 8-18 — Transcript, file page 3, lines 8-18
- Official Supreme Court Transcript — file page 4, lines 14-16 — Transcript, file page 4, lines 14-16
- Official Supreme Court Transcript — file page 4, lines 32-32 — Transcript, file page 4, lines 32-32
- Official Supreme Court Transcript — file page 4, lines 38-40 — Transcript, file page 4, lines 38-40
- Official Supreme Court Transcript — file page 5, lines 26-30 — Transcript, file page 5, lines 26-30
- Official Supreme Court Transcript — file page 6, lines 10-12 — Transcript, file page 6, lines 10-12
- Official Supreme Court Transcript — file page 6, lines 20-28 — Transcript, file page 6, lines 20-28
- Official Supreme Court Transcript — file page 7, lines 26-28 — Transcript, file page 7, lines 26-28
- Official Supreme Court Transcript — file page 8, lines 14-28 — Transcript, file page 8, lines 14-28
- Official Supreme Court Transcript — file page 8, lines 36-38 — Transcript, file page 8, lines 36-38
- Official Supreme Court Transcript — file page 9, lines 16-22 — Transcript, file page 9, lines 16-22
Official Court provenance
Official docket and case history · Official Supreme Court oral-argument detail page
Title and summary sources
- Official Supreme Court Transcript — file page 27, lines 30-10 — Transcript, file page 27, lines 30-10
- Official Supreme Court Transcript — file page 3, lines 20-50 — Transcript, file page 3, lines 20-50
- Official Supreme Court Transcript — file page 27, lines 30-10 — Transcript, file page 27, lines 30-10
- Official Supreme Court Transcript — file page 3, lines 20-50 — Transcript, file page 3, lines 20-50
Revision history
- Revision 1 · Official Transcript ·
Correction: Rewritten to the concise citizen-facing editorial standard.
- Revision 2 · Official Transcript ·
Correction: Migrated to the dated official Court activity contract without model use.