Supreme Court Will Decide Whether Farmers Pay Tax On Bankruptcy Sale


The Supreme Court recently granted an appeal from Lynwood and Brenda Hall, farmers who were compelled to sell their farm in bankruptcy. The farm was sold for $960,000, and the proceeds were used to resolve the Halls’ bankruptcy debts. As a result of the sale, the Halls owed $26,000 in capital gains taxes. The Halls attempted to pay a portion of the capital gains taxes, but wanted some of taxes discharged by the bankruptcy court. The IRS insisted that the entire $26,000 be paid. The case ended up in the U.S. Court of Appeals for the 9th Circuit in San Francisco. The 9th Circuit Court ruled in favor of the IRS. The United States Supreme Court granted the Halls’ petition for review, and will ultimately decide whether the taxes must be paid.

Source:

Associated Press, Supreme Court to Decide Whether Couple Must Pay Tax on Bankruptcy Sale of Family Farm, https://www.startribune.com/nation/123747189.html (accessed June 21, 2011).

Written by Hoglund Law

The attorneys of Hoglund law are licensed in Minnesota, Wisconsin and Ohio. Hoglund, Chwialkowski & Mrozik, PLLC is based in Roseville, Minnesota. In addition to handling cases involving bankruptcy & social security, Hoglund, Chwialkowski & Mrozik, PLLC handles faulty drugs and toxic exposure.

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