Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-88-02284/USCOURTS-ca10-88-02284-0/pdf.json

Nature of Suit Code: 422
Nature of Suit: Bankruptcy Appeals Rule 28 USC 158
Cause of Action: 

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IN RE: 

UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

JOHNS. BOWERS and 

SUSAN KAY BOWERS, 

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INTERNAL REVENUE SERVICE, 

Creditor-Appellant, 

FI LEO 

Un:.-e,, ;-f.'.JJ:f;r, VJllft of Appeal · -- · , .. Circuit 

FfS 2 2 19 

OBE_<r L. HOECKE 

C:Jerk 

v. 

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No. 88-2284 

(D.C. No. 88-F-514) 

(D. Colorado) 

JOHNS. BOWERS and SUSAN KAY 

BOWERS, 

Debtors-Appellees. 

ORDER AND JUDGMENT* 

Before SEYMOUR, BARRETT, and MOORE, Circuit Judges. 

John and Susan Bowers filed a Chapter 13 bankruptcy plan (the 

Plan) which provided for the payment of their pre-petition federal 

income tax liability of $2994.82 through monthly installment 

payments totalling $1000, to be paid over the life of the Plan. 

* This order and 

not be cited, or 

except for purposes 

the case, res 

Cir. R. 36.3. 

judgment has no precedential value and shall 

used by any court within the Tenth Circuit, 

of establishing the doctrines of the law of 

judicata, or collateral estoppel. 10th 

Appellate Case: 88-2284 Document: 01019964441 Date Filed: 02/22/1990 Page: 1 
The Plan also provided that the Bowers would pay the balance by 

permitting the IRS to offset any future income tax refund which 

they might generate during the life of the Plan by claiming no 

withholding exemptions for federal income tax purposes. The 

Government objected to confirmation, claiming that the Plan did 

not meet the requirements of 11 U.S.C. §§ 1322(a)(2) 1 and 

1325(a)(6). 2 

The bankruptcy court confirmed the Plan. It reasoned that 

the Plan satisfied§ 1322(a)(2) because it provided for payment of 

the priority tax liability in two deferred cash payments: one 

being the $1000 paid through the trustee, the balance being paid 

through the offsets. If the tax refunds did not meet the balance 

of the Bowers' liability, then their petition would be dismissed. 

The court made no explicit finding whether the Plan was feasible 

under 11 u.s.c. § 1325(a)(6). The district court affirmed. 

Before a bankruptcy court can confirm a Chapter 13 bankruptcy 

plan, it must determine that the Plan meets the criteria in 11 

U.S.C. § 1325(a), which includes the requirement that "the debtor 

will be able to make all payments under the plan and to comply 

1 Section 1322(a)(2) states: "(a) The plan shall-- .... (2) provide for the full payment, in deferred cash payments, of 

all claims entitled to priority under section 507 of this title, 

unless the holder of a particular claim agrees to a different 

treatment of such claim. . " 

The parties stipulated that the Bowers owe the amount which 

the Government claims and that this claim is entitled to priority 

under 11 U.S.C. § 507. They have also stipulated that the IRS has 

not agreed to a different treatment of the claim. 

2 Section 1325(a)(6) provides as follows: "(a) The court 

shall confirm a plan if-- . (6) the debtor will be able to 

make all payments under the plan and to comply with the plan." 

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Appellate Case: 88-2284 Document: 01019964441 Date Filed: 02/22/1990 Page: 2 
• 

with the plan." 11 U.S.C. § 1325(a)(6). When confirmation is the 

subject of an objection, § 1325(a) implicitly requires the 

bankruptcy court to make specific findings of fact to support its 

decision to grant or deny confirmation. Without such findings, a 

reviewing court has no basis on which to judge whether the 

bankruptcy court's decision on the petition for confirmation is 

clearly erroneous. Branding Iron Motel, Inc. v. Sandlian Equity, 

Inc., 798 F.2d 396, 399 (10th Cir. 1986) ("[T]he district court as 

well as the court of appeals must accept the factual findings of 

the bankruptcy court unless they are clearly erroneous."). 

In this case, the Government claims that the bankruptcy court 

erroneously confirmed the Plan. It asserts that since the Bowers' 

claim to tax refunds is a contingent or speculative event, they 

cannot satisfy the feasibility requirement in§ 1325(a)(6). The 

record, however, is barren of any evidence on which an appellate 

court can review the Government's claim. The bankr upt cy court, 

for example, made no finding of the amount of the Bowers' current 

or future income subject to withholding tax or of the projected 

annual tax refund which the Bowers would receive during the Plan. 

Without such evidence, we cannot determine whether the bankruptcy 

court's finding that the Plan satisfied § 1325(a)(6) is clearly 

erroneous. 

We, therefore, REMAND this case for further proceedings 

consistent with this order. 

Entered for the Court 

John P. Moore 

Circuit Judge 

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Appellate Case: 88-2284 Document: 01019964441 Date Filed: 02/22/1990 Page: 3