Hall v. United States

Summary

The Court held that federal income tax liability resulting from postpetition farm sale in Chapter 12 is not “incurred by the estate” under §503(b) because the estate is not a separate taxable entity under the IRC. Consequently, such tax cannot be treated as a priority claim eligible for discharge under §1222(a)(2)(A). Justice Breyer, dissenting, argued this interpretation frustrates congressional intent to provide farmers relief from tax liabilities arising during reorganization.