Nussbaum v. United States (In Re Smith)

MEMORANDUM OF OPINION GRANTING JUDGMENT TO PLAINTIFF ON COUNT III, AND DENYING APPROVAL OF SETTLEMENT OF COUNTS I AND II

E. STEPHEN DERBY, Bankruptcy Judge.

I. Introduction

By his adversary complaint, the Chapter 11 Trustee seeks to avoid and recover Debt- or’s postpetition payment of his individual federal income taxes for the calendar year in which this bankruptcy case was filed. The defendants are the Internal Revenue Service (“IRS”) as to Counts I and II and the individual debtor as to Count III. Because the Debtor failed to make an election under 26 U.S.C. § 1398(d)(2)(A) to bifurcate the…