Newburyport, MA asked in Bankruptcy for Massachusetts

Q: In chapter 13 plans, what happens if my town doesn't file a proof of claim for property taxes owed?

I finished a Chapter 13 plan (in Massachusetts) 6 months ago. I had claimed approximately $4000 in property taxes under the plan, my down filed a proof of claim for $2600. I made all the payments according to the plan, but now the town is saying I owe another $1400 in back taxes for which they never offered proof of claim. Do I still owe them that money if they submitted a lower proof of claim than the amount I claimed to owe in my filing?

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2 Lawyer Answers
Timothy Denison
Timothy Denison
  • Bankruptcy Lawyer
  • Louisville, KY

A: If they filed a proof of claim for $2600 and you paid it and completed the plan, then you don’t owe the money. You need to put this back in front of the court and get an order against them for violating the stay.

A: I think more information is required to answer your question. What tax years are involved? Is the $1400 pre-filing or post-filing? For what tax years did the proof of claim account vs. this $1400 balance?

It could be that it is a discharge violation, but it is also important to remember that a bankruptcy sweeps in debts owed prior to the filing of the case and not necessarily debts incurred post-filing, even a 3- to 5-year-long Chapter 13 payment plan. If you owed taxes for a post-filing tax year and didn't work with the municipality and the Chapter 13 Trustee to get a proof of claim filed and paid through the plan, it may be legitimately owed post-filing and would not be a discharge violation to collect.

You should discuss this with the attorney that assisted you with your Chapter 13 bankruptcy case or another local bankruptcy attorney if your Chapter 13 counsel is unavailable for some reason.

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