Section 16.15 Special Priority Rules in Chapter 7 Proceedings

• Library: Bankruptcy Practice (2007 Ed. + 2015 Cum Supp)

G. (§16.15) Special Priority Rules in Chapter 7 Proceedings

Despite the fact that secured claims are generally paid before unsecured claims in bankruptcy proceedings, the Bankruptcy Code subordinates tax liens to unsecured priority claims in Chapter 7 proceedings. 11 U.S.C. § 724(b):

(b) Property in which the estate has an interest and that is subject to a lien that is not avoidable under this title (other than to the extent that there is a properly perfected unavoidable tax lien arising in connection with an ad valorem tax on real or personal...