In re Zingale
- Summarized by Dean Langdon , DelCotto Law Group PLLC
- 14 years 8 months ago
- Citation:
- 2011 Fed App. 0005P; BAP Docket No. 10-8054
- Tag(s):
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- Ruling:
- The Debtors could not exempt the non-refundable portion of their Child Tax Credit because it only reduced their tax liability and did not constitute a "payment" under applicable Ohio law exempting certain payments from the Internal Revenue Service. The BAP for the Sixth Circuit affirmed the bankruptcy court's ruling sustaining the Trustee's objection to the Debtor's claimed exemption.
- Procedural context:
- The Debtors appealed a bankruptcy court order sustaining their Chapter 7 Trustee's objection to a claimed exemption in the non-refundable portion of their Child Tax Credit.
- Facts:
- Mom works as a clinical analyst at the Cleveland Clinic. Dad is the stay-at-home parent caring for their four children. Debtors filed a Chapter 7 on January 28, 2010 and scheduled a 2009 tax refund in an unknown amount. They later amended to exempt the amount of $4,000 attributable to the Child Tax Credit, using Ohio Rev. Code Sec. 2329.66(A)(9)(g). The Debtor's total refund was $8,542, consisting in part of a non-refundable Child Tax Credit of $2,903 and an additional child tax credit of $1,097 The Court engaged in a detailed, thorough review of prior cases addressing the non-refundable aspect of the Child Tax Credit, and followed the majority of cases which hold that the non-refundable portion only reduces tax liability, it not a payment, is therefore not property of the estate, and cannot be exempted. The Debtor's were allowed to exempt the $1,907 refundable portion of the Child Tax Credit.
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