As reported by Robin Miller of CBAR, a Chapter 13 plan may redeem property from tax sale so long as redemption period did not expire prior to filing of bankruptcy case. Affirming In re LaMont, 2012 WL 6727404 (N.D. Ill., Dec. 27, 2012), and resolving a longstanding split among the lower courts, the Seventh Circuit Court of Appeals held that a tax sale purchaser holds a “claim” under Code § 101(5) that may be treated in a Chapter 13 plan, at least so long as the debtor files the bankruptcy case before the debtor’s right to redeem the property expires under state law. The court reasoned that the tax sale purchaser has both a “right to payment” from the debtor’s property under § 101(5)(A) and a…

As reported by Robin Miller of CBAR, an Indiana Insurance policy was exempt where beneficiaries were debtor’s non-dependent adult children. Under Indiana law insurance upon the life of any person, as well as the proceeds or avails of such insurance, including cash surrender value, “which name[s] as beneficiary … the spouse, children, or any relative dependent upon such person” is exempt from the claims of the insured’s creditors, dependency is not required for the exemption so long as the beneficiary is the insured’s spouse or child; it only becomes necessary if the beneficiary is some other relative of the insured. According, here the debtor could exempt the cash value of a life insurance policy under which the debtor’s adult children were the beneficiaries, even though…

As reported by Robin Miller of CBAR, an Illinois Chapter 13 debtor could not modify confirmed plan on basis of information known prior to confirmation, to wit: Where the debtor proposed a Chapter 13 plan that provided for full payment of an unsecured priority claim of $11,432 held by the IRS; the IRS subsequently (but prior to plan confirmation) filed a proof of claim for the lesser amount of $10,024; and the debtor’s plan as originally proposed was confirmed, the debtor could not, four months later, modify her plan, on the basis of the lesser amount of the IRS claim, so as to reduce the plan term from 60 to 55 months, as the debtor and her counsel were clearly aware of the amount the…

As reported by Robin Miller of CBAR, an Insurance policy was exempt where beneficiaries were debtor’s non-dependent adult children, to wit: Under Indiana law which provides that insurance upon the life of any person, as well as the proceeds or avails of such insurance to include cash surrender value), “which name[s] as beneficiary … the spouse, children, or any relative dependent upon such person” is exempt from the claims of the insured’s creditors, dependency is not required for the exemption so long as the beneficiary is the insured’s spouse or child; it only becomes necessary if the beneficiary is some other relative of the insured. According, here the debtor could exempt the cash value of a life insurance policy under which the debtor’s adult children…

The short answer is that you lose the exemption. Lesson learned: Bankruptcy in Michigan is a process of full disclosure and complete transparency. As reported by Robin Miller of CBAR: The Amendment of an Exemption may be denied for deliberate concealment, bad faith or prejudice, to wit: Deliberate concealment of or failure to disclose an asset may justify denial of an exemption in that asset. An amendment to the debtor’s claimed exemptions may also be denied upon a showing of bad faith or prejudice to creditors or third parties. Debtors’ failure to disclose John Deere tractor warranted denial of amended exemption: The debtors’ failure to disclose, in their original schedules, a John Deere tractor purchased six years earlier for $12,000, and still worth at least…

The artile is reprinted with permission by my good friend and Philip Tirone of Credit Score 729. We have recently teamed up with Philip to provide you with the best (both legal and ethical) advice concerning your credit – whether you have filed bankruptcy or not. Why is your credit card balance important? Does it really matter? Should you use all your credit cards every month? What happens if you skip a month or two? Knowing your credit card balances and keeping your credit accounts active are important because both are factors when computing your credit score.. If your goal is to increase your credit score, below are some tips concerning your credit card balances and keeping your accounts active. One of the most frequently…

Robin Miller of CBAR posted the following Kentucky case note: Trustee did not establish right under Code § 363(h) to sell co-owned property free of co-owner’s interest, to wit: Trustee did not establish right under Code § 363(h) to sell co-owned property free of co-owner’s interest: The Chapter 7 trustee did not establish the right under Code § 363(h) to sell, free of the interest held by the debtor’s niece, 125.8 acres of undeveloped real property co-owned by the debtor and his niece as tenants in common. While the third and fourth elements of § 363(h) were satisfied, § 363(h)(1) was not, as conclusory testimony by a witness who had merely conducted a “drive by” inspection of the property, and who testified that he did…