*

The Honorable Robert Holmes Bell, 

the Western District of Michigan, sitting 

1

RECOMMENDED FOR FULL-

Pursuant to Sixth Circ

ELECTRONIC CITATION: 2000 F

File Name: 00a0

UNITED STATES COU

FOR THE SIXTH 

____________

In re: WILBUR G.WESTBERRY,

Debtor.

________________________INTERNAL REVENUE SERVICE,

Appellee,

v.

WILBUR G. WESTBERRY,

Appellant.

Appeal from the United St

for the Middle District of Te

No. 98-00438—Todd J. Cam

Argued: February 

Decided and Filed: 

Before: COLE and CLAY, Circu

Judge.

*
2 In re Westberry No. 98-6779

_________________

COUNSEL

ARGUED: Mark H. Westlake, WESTLAKE & MARSDEN,Nashville, Tennessee, for Appellant. A. Wray Muoio, TAXDIVISION, DEPARTMENT OF JUSTICE, Washington,D.C., for Appellee. ON BRIEF: Mark H. Westlake,WESTLAKE & MARSDEN, Nashville, Tennessee, forAppellant. A. Wray Muoio, TAX DIVISION,DEPARTMENT OF JUSTICE, Washington, D.C., DavidEnglish Carmack, U.S. DEPARTMENT OF JUSTICE,APPELLATE SECTION TAX DIVISION, Washington, D.C.,for Appellee.

_________________

OPINION

_________________

R. GUY COLE, JR., Circuit Judge. The sole issue

presented in this appeal is whether federal income and selfemployment taxes should be considered consumer debt forpurposes of 11 U.S.C. § 1301, the codebtor stay set forth inthe Bankruptcy Code. For the reasons that follow, we holdthat these taxes are not consumer debt and, therefore,AFFIRM the judgment of the district court. 

I. 

The facts are stipulated by the parties. The following

version is taken from the decision of the bankruptcy court:

Wilbur G. Westberry filed Chapter 13 on November 5,

1997. The debtor and his nonfiling spouse jointly owedfederal taxes for 1988 of $34,525.02. The debtor’s planproposed to pay the taxes in full in three years. The IRSbegan collection against the nonfiling codebtor byserving a notice of levy on her employer. The debtorfiled a motion to enforce the codebtor stay. The IRSobjected.
10 In re Westberry No. 98-6779

6Because we have determined that income taxes are not consumer

debt under the § 1301 codebtor stay, we need not reach the issue ofwhether the Anti-Injunction Act, 26 U.S.C. § 7421(a), preventsenforcement of the codebtor stay on income taxes. See In re Pressimore,39 B.R. at 244.same way), we do not believe our interpretation of theBankruptcy Code need be constrained by the interpretation ofan entirely different statute with a different purpose andhistory. See, e.g., United States v. Meade, 175 F.3d 215, 221(1st Cir. 1999) (stating that “precedent teaches that the casefor construing one statute in a manner similar to another isweakest when the two have significant differences and, here,the appellant seeks to compare plums with pomegranates”)(internal citation omitted).6

III.

For the forgoing reasons, we AFFIRM the district court’s

determination that income taxes should not be consideredconsumer debt for purposes of the § 1301 codebtor stay. 

No. 98-6779 

The tax debt relates only to inc

that year, the debtor was a ssalesman. He incurred self-employment taxes on his earned in 1988 was used by the personal, family, or household themselves and their three depassets were acquired in 198typewriter, and no money wainvestments, or other profit-mak

In re Westberry, 219 B.R. 976, 1998).

The bankruptcy court concluded 

consumer debt for purposes of the this case, because the taxes were family, or household purpose,” the Westberry, 219 B.R. at 978-79. T

The district court reversed the 

that the tax liability at issue was nit was not incurred, but “involgovernment for a public purpose” amoney rather than consumption.” Westberry), No. 3:98-0438 (M.DWestberry now appeals the distric

II.

The issue presented here, whe

should be considered consumer U.S.C. § 1301, is a question of novo. See Investors Credit Corp. 

F.2d 85, 88 (6th Cir. 1993).

The codebtor stay provides that 

to collect all or any part of a consumany individual that is liable on such U.S.C. § 1301. Consumer debt is Code as “debt incurred by an i
4 In re Westberry No. 98-6779

1At the time of trial, the debtor and his wife had separated and

maintained separate households.personal, family, or household purpose.” 11 U.S.C. § 101(8).Westberry argues that the stay should apply to prevent the IRSfrom attempting to collect from his wife,1 the codebtor on the1988 taxes because, as stipulated, the money that should havebeen paid in taxes was used for family and householdpurposes. 

This is an issue of first impression for our circuit as well as

the federal courts of appeals in general. Almost withoutexception, the bankruptcy courts that have addressed thisquestion have determined that tax debt should not beconsidered consumer debt for purposes of the codebtor stay.See, e.g., In re Stovall, 209 B.R. 849, 854 (Bankr. E.D. Va.1997); In re Dye, 190 B.R. 566, 567 (Bankr. N.D. Ill. 1995);In re Marshalek, 158 B.R. 704, 706 (Bankr. N.D. Ohio 1993);In re Greene, 157 B.R. 496, 497 (Bankr. S.D. Ga. 1993);Goldsby v. United States (In re Goldsby), 135 B.R. 611, 613-

15 (Bankr. E.D. Ark. 1992); In re Reiter, 126 B.R. 961(Bankr. W.D. Texas 1991); Harrison v. Internal RevenueService (In re Harrison), 82 B.R. 557, 558 (Bankr. D. Colo.1987); Pressimone v. Internal Revenue Service (In rePressimone), 39 B.R. 240, 244 (N.D.N.Y. 1984). We find theweight of these opinions and their reasoning persuasive. 

First, a tax debt is “incurred” differently from a consumer

debt. Although it is true that tax debts may be incurred underthe Bankruptcy Code, this incurrence is not voluntary on thepart of the taxpayer. See Reiter, 126 B.R. at 964; see alsoMarshalek, 158 B.R. at 706 (stating that “volition is essential”to a classification as consumer debt in finding that a vehicularaccident judgment was not consumer debt under Chapter 7).We may at least hope to choose to incur consumer debt; itscertainty being nothing like death and taxes. See Letter fromBenjamin Franklin to Jean-Baptiste Le Roy (Nov. 13, 1789).

No. 98-6779 

5Westberry does not argue that thes

would, of course, require us to interpret theach law.the consumer protection statutes uCode’s definition of consumer de

1054-55. The profit motive analyappropriate, to determine whethecategory of consumer debt. There test, or direction from the Bankruthe test defines the only categorTherefore, while the profit motive determination of which debts are nnot prohibit other debts from fallinconsumer debt. See Marshalek, 15motive test is normally applexpenditures. . . . An inability to ca business debt does not automaticof consumer debt.”). But see Keste99 F.3d 146, 149 (4th Cir. 1996) (that because debt was not businedebt). 

Westberry also argues that in

deemed personal debt for purpostherefore, the same classification Bankruptcy Code.5 For example, 

that classifies interest on income tawhich cannot be deducted, to suppC.F.R. § 1.163.9T(b)(2)(i)(A). ACongress, see, e.g., Trans World 469 U.S. 111, 126 (1985) (using Fair Labor Standards Act provisiothe Age Discrimination in Employmshowed detailed knowledge of the ADEA) or obvious similarity of lanthese statutory provisions, see, e.Educ. of the Memphis City Schs., (noting that a similarity of languad’etre” indicate that two statutes s
8 In re Westberry No. 98-6779

are primarily for personal, family, or household purposes”); 15 U.S.C.§ 1602(h) (defining, under the Truth in Lending Act, a “consumer loan”as “[a transaction] in which the party to whom credit is offered orextended is a natural person, and the money, property, or services whichare the subject of the transaction are primarily for personal, family, orhousehold purposes”).

4We note that at least two sister circuits have suggested that taxes

should not be considered “debt” under the Fair Debt Collection PracticesAct. For example, Beggs v. Rossi, 145 F.3d 511, 512 (2d Cir. 1998),states:

The [Fair Debt Collection Practices Act] defines a “debt” as“any obligation or alleged obligation of a consumer to paymoney arising out of a transaction in which the money, property,insurance, or services which are the subject of the transaction areprimarily for personal, family, or household purposes, whetheror not such obligation has been reduced to judgment.” 15 U.S.C.§ 1692a(5). In determining that the personal property taxes atissue in this case are not “debts” within the meaning of theFDCPA, the district court relied principally upon the decision ofthe Court of Appeals for the Third Circuit in Staub v. Harris,626 F.2d 275 (3d Cir. 1980). In Staub, the Third Circuit heldthat “at a minimum, the statute contemplates that the debt hasarisen as a result of the rendition of a service or purchase ofproperty or other item of value. The relationship betweentaxpayer and taxing authority does not encompass that type ofpro tanto exchange which the statutory definition envisages.” Id.at 278. We agree with the district court that Staub is persuasiveauthority and is dispositive in this case.

that cases under these similarly worded statutes guide ouranalysis of this issue.4 Congress did not indicate, through thelegislative history of § 1301, whether it intended to includetaxes under the codebtor stay.

This distinctive treatment of taxes under the Bankruptcy

Code, as well as the distinctions between tax debt andconsumer debt, indicate that the profit motive test, which wasused by the bankruptcy court in this case, is not determinativeof this issue. The profit motive test determines that debt isnot consumer debt if the debt was “incurred with an eyetoward profit.” In re Booth, 858 F.2d 1051, 1055 (5th Cir.1988). This test was derived from a similar test used under

No. 98-6779 

Second, consumer debt is i

household purposes, as stated in tincurred for a public purpose. Se(stating that taxes are “imposed public welfare” in the course of finproperty tax on the debtor’s car wpurposes of the codebtor stay). Thnoted, in other contexts, the public of taxes. See, e.g., Loan Assoc. v. (1874) (“We have established . . . bbe no lawful tax which is not laid 

Third, taxes arise from the e

consumer debt results from its cons

B.R. at 497; Harrison, 82 B.R. at 

at 244. Different events give rise to debt – Westberry’s obligation to earning of income, not from his exfamily items. 

Finally, unlike taxes, consumer d

extension of credit. 

The sum of these material differ

that Westberry’s tax debts cannot debt for purposes of the § 1301 co

Westberry contends that In re 

(Bankr. D. Utah 1990) counsels udisagree. In Whitelock, the debtor 

Security Financial (FSF), securefamily home, to pay an IRS liabidebtor then took out a second notthis second note was secured by a residence. See id. at 585-86. The dunder Chapter 13 approximately tThe bankruptcy court found that threal property may be considered colanguage in the legislative history oto § 101(8) -- which states that include debt secured by real proper
6 In re Westberry No. 98-6779

2This court has not interpreted the “consumer debt” language of the

Bankruptcy Code, even in other contexts within the Code. See Cohen v.De la Cruz, 523 U.S. 213, 220 (1998) (noting the “presumption thatequivalent words have equivalent meaning when repeated in the samestatute”). Our sister circuits have examined the “consumer debt”language, as applied to other sections of the Code, but not with respect totax debts. See Stewart v. United State Trustee (In re Stewart), 175 F.3d

796 (10th Cir. 1999) (finding that a Chapter 7 debtor’s funds were put tohousehold living expenses and, therefore, were consumer debts); Kestellv. Kestell (In re Kestell), 99 F.3d 146 (4th Cir. 1996) (determining, undera profit motive test, that money owed to the debtor’s former wife from adivorce judgment was consumer debt for purposes of § 707); Burns v.Citizens Nat’l Bank (In re Burns), 894 F.2d 361 (10th Cir. 1990) (finding

that loans taken out to play the stock market were not consumer debt, forpurposes of determining whether attorney fees should be provided under11 U.S.C. § 523(d)); Zolg v. Kelly (In re Kelly), 841 F.2d 908, 913 (9th

Cir. 1988) (finding, in a § 707(b) case, that attorney fees were consumerdebt because the suit was begun “for the purpose of recovering moneyallegedly overpaid in purchasing their home”); In re Booth, 858 F.2d 1051(5th Cir. 1988). These cases do not change or detract from our analysis.

124 Cong. Rec. H11,090 (daily ed. Sept. 28, 1978) (statementof Rep. Edwards); 124 Cong. Rec. S17,406 (daily ed. Oct. 6,1978) (statement of Sen. DeConcini)). The court looked tothe purpose of the debt, concluding that the second loan,which was used to pay off the first loan that payed the IRSdebt, served “a family or household purpose.” Id. at 587. Thecourt assumed that the debt was either consumer or businessand, because there was “no substantial indication that therepayment of the FSF debt was in any manner businessrelated,” it was, therefore, consumer debt. Id. Whitelock isdistinguishable from the present case because the debt wasonly indirectly incurred to cover the IRS liability, not directlyincurred as in this case. Further, Whitelock, in dictum,approvingly quotes two cases which find that tax debt is notconsumer debt. See Whitelock, 122 B.R. at 587 n.8 (citingHarrison, 82 B.R. at 558; Pressimone, 39 B.R. at 245).

In order to determine the meaning of consumer debt, we

also examine the “language and design of the statute as awhole.” Schroyer v. Frankel, 197 F.3d 1170, 1174 (6th Cir.

1999).2 Throughout the Bankruptcy Code, Congress has

No. 98-6779 

3See 15 U.S.C. § 1692(a) (definin

Collection Practices Act, as “any obligaconsumer to pay money arising out of a tproperty, insurance, or services which arclearly treated tax debt differently fconsumer debt. For example, cdischargeable in bankruptcy, based of the importance of the collectioU.S.C. § 523(a)(1) (nondischargeasee also 146 Cong. Rec. S167-05 2000) (statement of Sen. Levin) (quReview Commission Final ReporBankruptcy (1997)) (“Other dedischarge because of the inherent without regard to any culpability othe debtor’s good faith, for examremain nondischargeable. Societhose debts from discharge outweifresh economic start.”); Bruning v358, 361 (1964) (noting, in the conprovision of the prior Bankruptcy that the provision “demonstrates cocertain problems -- e.g., those of override the value of giving the debIn addition, tax debts are given a pcertain other debts. See, e.g., 11 U

We note that although we have a

consumer debt based on the plain the statute, see Zolg v. Kelly (In re (9th Cir. 1988) (stating that consumeaning interpretation); Reiter, 12need to resort to legislative history consumer debt under § 1301), evstatutory language ambiguous, the decisive of this issue. The Bankru“consumer debt” is derived from cSee S. Rep. No. 95-989 at 22 (U.S.C.C.A.N. 5787, 5808.3 West