Document Type
Article
Publication Date
12-1957
ISSN
0044-0094
Publisher
Yale Law School
Language
en-US
Abstract
ONCE viewed as immune property within the custody of the federal sovereign, a bankrupt's estate is now generally subject to the same state and local taxes as are the property and activities of an individual. Judicial recognition that government services subsidized by state property taxes were ratably extended to property in the hands of the bankruptcy trustee engendered the initial inroad on this immunity. Subsequent federal legislation relegates agents or officers conducting businesses by authority of United States courts to the status of private parties for purposes of taxation. However, some courts have denied the imposition of state and local taxes on trustee-conducted liquidation sales. Holding the waiver statute inapplicable, they have asserted that allowing such taxes might interfere with Congress's paramount authority over bankruptcy by burdening the court process through which that authority is exercised. Other courts, reasoning that taxes levied against the buyer at a liquidation sale rather than the trustee are irrelevant to the court process, have upheld these taxes without reliance on the statute.
Recommended Citation
Neil S. Hecht,
State Taxation of Bankruptcy Liquidations: Federalism Misconceived
,
67
Yale Law Journal
335
(1957).
Available at:
https://scholarship.law.bu.edu/faculty_scholarship/1575
