Ch. 13 Bars Tax Deed Owner's Property Claim, 7th Circ. Says

Law360, New York (January 8, 2014, 1:56 PM EST) -- The property interests of a tax deed purchaser can be discharged in a property owner's Chapter 13 bankruptcy, the Seventh Circuit said Tuesday, leaving Illinois' tax deed holders scrambling to figure out the ramifications.

In a unanimous opinion, a three-judge panel said that after property owner and delinquent tax filer Todd LaMont entered bankruptcy, Lyubomir Alexandrov's tax deed claim was properly stayed under bankruptcy civil procedure rules and LaMont was free to work out tax payments in his bankruptcy plan.

“Here, because the [bankruptcy] plan succeeded,...
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