Document: 495 U.S. 545 110 S.Ct. 2139 109 L.Ed.2d 580 UNITED STATES, Petitionerv.ENERGY RESOURCES CO., INC., et al. No. 89-255. Argued March 19, 1990. Decided May 29, Syllabus The Internal Revenue Code requires employers to withhold from their employees' paychecks money representing the personal income and Social Security taxes. 26 U.S.C. §§ 3102(a), 3402(a). Because must hold these funds in "trust for United States," § 7501(a), taxes are commonly called fund" Should an employer fail pay such taxes, 6672 authorizes Government collect equivalent sum directly employer's officers or employees who responsible collecting tax thus referred as "responsible" individuals. Newport Offshore, Ltd., Energy Resources Co., Inc., filed separate petitions reorganization under Chapter 11 of Bankruptcy Code. In conjunction with plans which they had approved, both Courts authorized payments on federal liabilities reorganized corporations be applied extinguish trust fund debts before paying off nontrust portions liabilities. Service (IRS) appealed cases appropriate Federal District Courts, which, respectively, reversed Offshore affirmed Resources. Consolidating two cases, Court Appeals turn former but latter. Held: A bankruptcy court has authority order IRS treat made by debtor where determines that this designation is necessary success a plan. Although does not explicitly authorize approve designating either fund, orders at issue wholly consistent court's broad including "any provision inconsistent . title," 1123(b)(5), "issue any carry out [Code's] provisions," 105. Other provisions protecting Government's ability delinquent do preclude issuing orders, since those restrictions address designate whether non-trust-fund assure its will paid even if incorrect judgment plan succeed. Nor contravene Code—the individuals provision—which remains during after corporate filing alternative source By terms, section protect against eventuality that, cannot corporation's might able only debt, leaving risk Pp. 549-551. 871 F.2d 223 (CA1 1989), affirmed. WHITE, J., delivered opinion Court, REHNQUIST, C.J., BRENNAN, MARSHALL, STEVENS, O'CONNOR, SCALIA, KENNEDY, JJ., joined. BLACKMUN, dissented. Alan I. Horowitz, Washington, D.C., petitioner. Guy B. Moss, Boston, Mass., respondents. Justice WHITE Court. 1 case, we decide 2 * law Slodov v. States, 436 238, 242-243, 98 1778, 1782-1783, 56 251 (1978). may tax. 6672. These Slodov, supra, 244-245, S.Ct., 1783-1784. 3 This case involves have Code, 1101-1174. petition November 13, 1985; approved June 1986, creating Oil Inc. Over IRS' objection, included stating would (totaling about $300,000) over period six years all " 'prior commencement payment non-trust portion' owed. re 223, 226 1989). States Rhode Island, unpublished opinion. then sought review First Circuit. 4 petitioned January 1983. September 1984, confirmed created special among other things, was Resources' debt approximately $1 million roughly five years. 1985, trustee sent $358,000 IRS. asked apply debt. After refused so, successfully Id., 226-227. Massachusetts, oral 5 Circuit Ltd. Co. 234. first considered pursuant "voluntary" "involuntary" terms used own rules. policy permits taxpayers "voluntarily" submit liability apply. See id., 227, citing Rev.Rul. 79-284, 1979-2 Cum.Bull. 83, modifying 73-305, 1973-2 43, superseding 58-239, 1958-1 94. taxpayer argued within best characterized therefore rules bind agency respect debtors' payments. Granting deference agency's interpretation rules, accepted view involuntary purposes F.2d, 230. concluded, however, were properly IRS's regulations, nevertheless concluded ensure reorganization. 230-234. 6 We granted certiorari because Circuit's conclusion conflicts decisions Circuits. 493 963, 402, 107 369 (1989); see, e.g., Ribs-R-Us, 828 199 (CA3 1987). affirm below, rightfully consid ered involuntary, II 7 courts fund. grants residual applicable title." 1123(b)(5); see also 1129. states order, process, provisions" 105(a). statutory directives traditional understanding courts, equity, modify creditor-debtor relationships. Pepper Litton, 308 295, 303-304, 60 243-244, 84 L.Ed. 281 (1939); National Bank Chase Bank, 331 28, 36, 67 1041, 1045, 91 1320 (1947); Katchen Landy, 382 323, 327, 86 467, 471, 15 391 (1966). 8 suggests transgressed one limitations equitable power. Specifically, contends conflict Code's As points out, provides priority specified claims, makes nondischargeable. 507(a)(7), 523(a)(1)(A). moreover, itself succeed, 1129(a)(11), IRS, likelihood, 1129(a)(9)(C). 9 It evident type here, correct it can liability, stands better chance discharge guaranteed While result desirable standpoint, added protection itself: Whereas gives right assured years, wants assurance fails—i.e., 10 Even inappropriate conflicted another should been taken into consideration exercise discretion. maintains here permitting unpaid assets reflects congressional decision revenues ensuring additional collected. true unable taxpayer, revenue. Here, Courts' prevent revenue; contrary, require concedes, collection because, non-trust-fund, 6672, eventuality. That plainly us otherwise nonetheless improvident. III 12 limitation offset obligations concludes action reorganization's success. 13 Affirmed. 14 BLACKMUN dissents.

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