Kuhl v. United States

After appellant Barbara Ann Kuhl filed in bankruptcy and achieved the discharge of her debts, the IRS garnished her wages. Kuhl demonstrated that most of the tax liabilities had been discharged, and she thereby defeated the garnishment. She now seeks to recover from the IRS attorneys’ fees she incurred litigating the issue of dischargeability.

The Bankruptcy Court for the Eastern District of New York (Bernstein, J.) denied her motion for attorneys’ fees, and the District Court for the Eastern District of New York (Seybert, J.) affirmed. On appeal, the IRS asserts that Kuhl failed to exhaust…