Analyze all or a portion of Begier v. IRS, using the Issue, Rule, Application, and Conclusion methodology in your comments below. Remember to “Blue Book” where appropriate.
Begier v. IRS, 496 US 53 – Supreme Court 1990
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Facts: Employer was required to hold excise and withholding taxes in trust account for IRS. Some taxes were paid from a special account set up on behalf of the IRS, others were paid from the company’s general account. Employer filed under Ch. 11, and trustee tried to avoid the payments made to the IRS from the general account.
Issue: Whether the trustee could avoid those payments?
Rule: Chapter 11 of the Bankruptcy Code
Analysis: The funds paid from the general account were held in trust by the debtor for the IRS and thus were not “property of the debtor” prior to payment.
Conclusion: Accordingly, the trustee would not recover the funds.