Opinion ID: 1358766
Heading Depth: 1
Heading Rank: 4

Heading: Legislative Intent and History

Text: The Seventh Circuit noted that Congress had failed to pass an earlier version of the statute that would have expressly incorporated the IRM standards into § 707(b)(2)(A)(ii)(I). Id. at 1159. Instead, Congress ultimately passed the current statutory language that refers only to amounts specified in the National and Local Standards. Id. (citing H.R. 3150, 105th Congress (1998)). The court stated, This change indicates Congress's intent that courts not be bound by the financial analysis contained in the IRM and supports the conclusion that courts should look only to the numeric amounts set forth in the Local Standards. Id. In addition, the court identified the reduction of judicial discretion and the incorporation of a uniform and readily-applied formula, id. at 1160 (quotation omitted), for performing the means test as important aspects of Congressional intent surrounding the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA). The court found such intent inconsistent with the implied incorporation of the IRM standards because the IRM standards vest revenue officers with discretion, and use of the IRM standards in the context of the Chapter Seven means test would, necessarily, vest bankruptcy judges with similar discretion. Id. Further, as noted by a Sixth Circuit Bankruptcy Appellate Panel in In re Kimbro, 389 B.R. 518, 527 (6th Cir.BAP2008), the IRS itself disavows any intent to have the financial standards from the IRM apply in any context other than tax collection and specifically disclaims any intent to have the IRM apply in the context of bankruptcy expense calculations: Disclaimer: IRS Collection Financial Standards are intended for use in calculating repayment of delinquent taxes. These Standards are effective on March 1, 2008 for purposes of federal tax administration only. Expense information for use in bankruptcy calculations can be found on the website for the U.S. Trustee Program. Id. (quoting http://www.irs.gov/individuals/ article/0,,id=96543,00.html). As such, the court in Kimbro found that the intent of the administrative body that formulated the IRM, as well as legislative intent, supported a refusal to incorporate the IRM into the means test for determination of disposable income. Id. at 526-27. We, too, have recognized the reduction of judicial discretion as one aspect of Congress's intent surrounding BAPCPA. See Frederickson, 545 F.3d at 658 (In enacting BAPCPA, Congress reduced the amount of discretion that bankruptcy courts previously had over the calculation of an above-median debtor's income and expenses.). We have acknowledged, however, that it was also Congress's intent that under BAPCA increased payments will flow from above-median debtors to their unsecured creditors, id., and that Congress enacted [BAPCPA] to ensure that debtors repay creditors the maximum they can afford. Id. at 657 (internal quotation omitted). We do not believe that these different expressions of intent detract from the soundness of the court's ruling in Ross-Tousey. As we noted in Frederickson, Congress rigidly defined `disposable income' in 11 U.S.C. § 1325(b)(2) [but] did not define `projected disposable income' as used in 11 U.S.C. § 1325(b)(1)(B). Id. at 658. Ross-Tousey, involved application of the Chapter Seven means test, and our case today involves application of that same means test as incorporated by 11 U.S.C. § 1325(b)(3) to define disposable income. As applied in this context, we find the Seventh Circuit's analysis of Congressional intent to be sound. [4]