Adam Brown | Bloomberg LawIn re Calabrese, No. 10-6583, 2011 BL 233776 (D. N.J. Sept. 13, 2011) The United States District Court for the District of New Jersey affirmed a bankruptcy court's order holding a chapter 13 debtor individually liable for sales taxes collected in the course of operating his bankrupt business. Although the debtor argued that sales tax fell within the definition of "excise taxes," which are dischargeable under the bankruptcy code, the district court explained that Congress's intent was that only sales tax owed personally by the retailer qualified as "excise taxes," whereas sales taxes collected from customers and held in trust for the State are non-dischargeable.
Sales Tax Claim
11 U.S.C. § 507(a)(8)
Sales Tax Not Dischargeable
District Court Affirms Bankruptcy Court's Ruling
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