In a Chapter 12 case, post-petition capital gains taxes resulting from the pre-petition sale of farm assets are unsecured claims not entitled to priority. Priority and non-priority tax claims should be allocated proportionally, not marginally.

The debtors' income tax refunds, including child tax credits and earned income credits, were property of the bankruptcy estate under § 541 and should have been turned over to the trustee for administration and distribution of the non-exempt portion.

The court granted the debtor’s motion to avoid a lien under § 522(f)(1)(A). The debtor’s former spouse held a judgment for the property settlement due to her. The debtor later purchased a residence and filed a Chapter 13 petition. The debtor then moved to avoid the property settlement judgment lien, asserting that it impaired his homestead exemption. The creditor argued that a judgment lien cannot be avoided under § 522(f)(1)(A) unless the debtor held an interest in the property at the time the judgment lien came into existence, relying on Farrey v. Sanderfoot, 500 U.S. 291 (1991).

The court denied the defendant's motion to dismiss the adversary. By failing to timely object, defendant waived his arguments regarding the validity of the extension of the avoidance action statute of limitations granted to the bankruptcy trustee.

Although the complaint appeared to be brought under § 727 and § 523, it contained no § 727 allegations, & entry of discharge prior to trial was res judicata. Moreover, the evidence at trial did not establish the elements of § 727(a)(2) or § 523(a)(2)(A).

A deed of trust recorded against the wrong lot would be void as to a subsequent purchaser of that lot without notice. Pursuant to § 544(a)(3), the bankruptcy trustee, as a BFP, may avoid the deed of trust because it failed to describe debtors' property.

The court dismissed the bankruptcy case as an abuse because the debtor tried to take advantage of a perceived § 707 loophole in arguing that the mortgage debt on his home was not consumer debt simply because he was not an obligor on the underlying notes.

Under the totality of the circumstances, granting the debtors relief under Chapter 7 would be an abuse because they could significantly reduce their expenses without depriving themselves of necessities and thereby make payments to unsecureds.

Business-related lease payments due from debtors, when calculated pursuant to § 502(b)(6)(A), are less than the debtors' consumer debts. Because they have "primarily consumer debts," they are subject to the means-testing provisions of § 707(b).

Published at 379 B.R. 903. Post-BAPCPA, a Chapter 13 debtor does not fail the 1325(a)(3) good-faith test simply by having the ability to pay more than the means test result. There must be something else to trigger a lack of good faith in proposing a plan.