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The Delaware Bankruptcy Insider is a premier blog designed to bring its readers a comprehensive analysis of the latest Delaware corporate bankruptcy news and rulings. Brought to you by Ashby & Geddes, P.A.
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- Delaware Court of Chancery
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Recent Posts
- Getting Noticed in the Digital Age: Delaware Bankruptcy Court Finds Email Notice Satisfies Due Process but Not Rule 2002
- Third Circuit Reversal Paves the Way For NextEra to Potentially Recover Administrative Expenses Incurred in Connection With Failed Merger
- Delaware District Court Disagrees with Bankruptcy Court’s Ruling and Holds That Committee’s Challenge Rights Survived Entry of the Sale Order and Consummation of Sale
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For more information
“Straddling the Line”: Delaware Bankruptcy Court Rules That Not All Tax Liabilities Incurred During a Debtor’s Petition Year are Eligible for Administrative Expense Priority
In re Affirmative Insurance Holdings, Inc., Case No. 15-12136 (CSS), 2019 WL 5173773 (Bankr. D. Del. Oct. 15, 2019).
In this Opinion, Chief Judge Sontchi ruled that tax liabilities incurred by a corporation during a year that “straddles” the petition date should be bifurcated, such that tax liabilities stemming from post-petition events are afforded administrative expense priority, whereas tax liabilities stemming from pre-petition events are afforded general unsecured status. In so doing, his Honor departed from the previous practice of affording administrative expense priority to tax liabilities incurred by a corporate debtor during the year of its petition date in… Read More
IRS Not Required to File Proof of Claim for Certain Taxes Arising From Employee Wages Earned Pre-petition But Paid Post-petition
In re Goody’s LLC, No. 09-10124 (CSS) (Bankr. D. Del. May 13, 2014)
A recent Opinion issued by Judge Sontchi analyzed a motion filed by the debtors in In re Goody’s LLC to enforce plan injunctions and determine liability for certain employment taxes. The issue in Goody’scentered on the post-petition payment of allowed pre-petition wage claims. The debtors withheld employment taxes (the “Withheld Amounts”) from the wage payments, filed requisite tax returns, deposited the Withheld Amounts with the Internal Revenue Service (the “IRS”), and requested the IRS to apply the Withheld Amounts to the employees’ federal income and Social… Read More