In an 8-1 opinion, the Supreme Court holds that the waiver of sovereign immunity under Section 106(a) does not extend to suits brought by a trustee under state law standing in the shoes of an actual creditor.

Whoever was overwithheld is entitled to the IRS refund when one spouse doesn’t file, Judge Michael Slade says.

The circuits are split on whether a bankruptcy court can compel marshalling by the IRS.

Most justices seemed inclined to believe that the waiver of sovereign immunity in Section 106(a) does not abrogate the “actual creditor” requirement in Section 544(b)(1).

To resolve a circuit split, the Supreme Court has agreed to decide whether a trustee can sue the government to recover a fraudulent transfer under state law when sovereign immunity would bar an ‘actual creditor’ from suing.

The lack of perfection of a federal tax lien did not mean that the entireties interest was exempt under Section 522(b)(3).

Bankruptcy Judge Russin declines to follow the Third Circuit and adopts the conclusion of bankruptcy courts holding that Sub S status is estate property.

Looking beyond the label assigned by the Affordable Care Act, three circuits have now held that failure to pay the ‘individual mandate’ for purchasing health insurance gave rise to a tax entitled to priority in bankruptcy.

The circuits are now split 3/1, with the majority finding a waiver of sovereign immunity under Section 544(b)(1) for lawsuits by a trustee based on claims that an actual creditor could not have brought outside of bankruptcy.

The Affordable Care Act’s ‘individual mandate’ was a tax measured by income, thus giving the IRS a priority tax claim.