Court ruling: The IRS can collect interest on taxes paid as part of a bankruptcy plan. If an employer fails to properly pay over payroll taxes, the IRS can collect a “trust fund recovery penalty” equal to 100% of the unpaid taxes. In one case, a taxpayer who owed personal income taxes filed for Chapter 13 bankruptcy and settled his tax debt and the penalty in bankruptcy court. Postdischarge, the IRS assessed him for the unpaid, nondischargeable interest on the taxes and civil penalties. The man argued that the unpaid interest on taxes and penalties that he’d paid in full under a bankruptcy plan couldn’t be collected by the IRS. The bankruptcy court disagreed. (Widick, Bktcy Ct NE, 9/10/19)  Visit our website for further information!