Before getting into the meat and potatoes of today’s post, I want to acknowledge a comment by a fellow bankruptcy attorney.  At a recent continuing legal education presentation she asked why I hadn’t been regularly posting, and encouraged me to post more frequently.  I must confess that since I hadn’t heard much from my readership, I was a bit discouraged.  Her words put a fire under my seat — which is better than the fire I get from the spicy food I foolishly love — so I will try to be more regular (daily prune juice is helping).

In any event, I recently answered a couple of questions posed by a fellow bankruptcy attorney — not the same one mentioned in the previous paragraph — and thought you might find the exchange interesting.  The questions were:

Debtor was sued in Superior Court and a judgment was entered relating to the repayment of unemployment claims in 2010 to the Employment Development Department – State of California.

Q1: Is this a priority claim?

Q2: If the Debtor’s chapter 13 plan provides for this claim but the EDD does not file a proof of claim, will the claim be paid by the trustee?  If not, will the debt be discharged?
Continue Reading The Treatment Of Unemployment Taxes In Bankruptcy