Manty v. Johnson (In re Johnson)

Summarized by Bryan Robinson , Law Offices of Bryan Robinson
11 years 10 months ago

Citation:

In Re Johnson, 8th Circuit Bankruptcy Appellate Panel, No. 13-6050. (April 22, 2013)

Tag(s):

Ruling:

The 8th Circuit Bankruptcy Appellate Panel reversed the ruling of the Bankruptcy Court permitting the Debtor’s claimed exemption in her property tax refund as a “government assistance". The 8th Circuit Bankruptcy Appellate Panel concluded that the property tax refund at issue were not “government assistance based on need,” and is therefore not exempt under § 550.37, subd. 14 of the Minnesota Statutes. The Bankruptcy Appellate Panel cited its' rationale in a Missouri Case, which held that federal tax refunds that included the child tax credits were not exempt as public assistance benefits (Hardy v. Fink (In re Hardy),503 B.R. 722 (B.A.P. 8th Cir. 2013)).

Procedural context:

Chapter 7 Trustee objected to debtor's claimed exemption in a $1,946 real property tax refund under § 550.37, subd. 14 of the Minnesota Statutes as “government assistance based on need.” The Bankruptcy Court overruled the Trustee’s objection and allowed the exemption in the refund in its entirety. The Chapter 7 Trustee appeals from the Order of the Bankruptcy Court holding that a property tax refund is exempt under Minn. Stat. § 550.37, subd. 14, as “government assistance based on need.”

Facts:

Debtor Grace M. Johnson is an 88-year old widow whose only regular source of income is social security. She owns a home valued at $200,000 with approximately $150,000 in equity. She occasionally supplements her income by renting out a bedroom in her home. After she filed a Chapter 7 bankruptcy case, the Chapter 7 Trustee objected to her claimed exemption in a $1,946 real property tax refund under § 550.37, subd. 14 of the Minnesota Statutes as “government assistance based on need.” The Bankruptcy Court overruled the Trustee’s objection and allowed the exemption in the refund in its entirety. The Trustee appeals.

Judge(s):

FEDERMAN, Chief Judge, SCHERMER and NAIL, Bankruptcy Judges.

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