Can a township employer withhold...
No. Michigan employers may not withhold a paycheck even if an employee (or former employee) has retained the employer’s property. The payc...
Read MoreOur Feed
We are involved in our communities, our profession, and our clients' associations and activities.
How does the Township Treasurer collect personal property tax from a business in bankruptcy?
A bankruptcy proceeding occurs when an insolvent business (or individual) files a petition, which starts the bankruptcy proceeding. On the date the petition is filed, debts owed by the business are classified as pre-petition debts and post-petition debts. If personal property taxes were due before the filing, that is a pre-petition debt and should be included in the Township's claim. Post-petition debts can also be collected by filing claims during the bankruptcy proceeding. These claims are known as administrative expenses.
Post-petition debts often include personal property taxes that will come due during the bankruptcy proceeding. The Township Treasurer can obtain a jeopardy assessment under MCL 211.691 and accelerate the date that future personal property taxes are due and become a lien. As a lien, the claim will receive priority of payment in the bankruptcy proceeding. While recovery is not guaranteed, it does improve the chances of payment.
Recent Articles & Announcements
-
-
Employees or Independent Contrac...
Townships of all sizes rely on workers to carry out basic governmental functions and keep the township running smoothly. Although larger tow...
Read More -
Can the Township enter into a co...
A Township can only enter into such a sales contract if the property is no longer being used for a public purpose. Michigan courts have defi...
Read More
Talk to an Attorney
Request a ConsultationAt Fahey Schultz Burzych Rhodes PLC, we’ve been helping municipalities, franchised businesses, employers, and more with their legal needs since 2008. We’d love to learn how we can help you, too.
