Justices Urged to Decide Bankruptcy Powers Over Tax Penalties

Law professors urged the US Supreme Court to consider an appeal over a bankruptcy court’s authority to decide a dispute surrounding the discharge of an Indiana couple’s tax liabilities.

The US Court of Appeals for the Seventh Circuit’s narrow interpretation of whether a bankruptcy court could determine the amount of federal tax liability that could be eliminated for Donald and Kimberly Bush through their 2014 bankruptcy is a departure from accepted principles of bankruptcy jurisdiction, the five law professors said in an amici brief filed Tuesday.

Bankruptcy courts for decades have been able to to rule on dischargeability fights and ...