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ARTICLE · 12 FEBRUARY 2013

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Jones Day
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The Court considered whether federal capital-gains-tax liability resulting from the sale by "family farmer" debtors of their farm property during a chapter 12 case was "incurred by the estate" under section 503(b) of the Bankruptcy Code.

United StatesInsolvency/Bankruptcy/Re-Structuring
Charles Oellermann
Charles Oellermann
Mark Douglas
Mark Douglas
Scott Friedman
Scott Friedman
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The U.S. Supreme Court handed down only two rulings in 2012 concerning bankruptcy issues. In RadLAX Gateway Hotel, LLC v. Amalgamated Bank, 132 S. Ct. 2065 (2012), a unanimous Court upheld a ruling by the Seventh Circuit denying confirmation of a "cramdown" chapter 11 plan that contemplated the sale of encumbered assets free and clear of all liens without giving a secured creditor the right to credit-bid its claim in connection with the sale. By its ruling, the Supreme Court resolved a circuit split on the proper application of the "indubitable equivalent" prong of section 1129(b)(2)(A) of the Bankruptcy Code.

In Hall v. U.S., 132 S. Ct. 1882 (2012), the Court considered whether federal capital-gains-tax liability resulting from the sale by "family farmer" debtors of their farm property during a chapter 12 case was "incurred by the estate" under section 503(b) of the Bankruptcy Code. This is required to enable the debtor to strip the federal government's

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