United States v. New York,
315 U.S. 510 (1942)

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U.S. Supreme Court

United States v. New York, 315 U.S. 510 (1942)

United States v. New York

No. 238

Argued February 2, 1942

Decided March 2, 1942*

315 U.S. 510


1. Under §§ 801 and 802 of Title VIII of the Social Security Act, an employer is required to collect the tax laid on the wage incomes of his employees, but is liable for its payment whether or not he collects it. P. 315 U. S. 515.

2. This liability of the employer is a tax, and a claim thereon is entitled to priority as for a tax under § 64(a)(4) of the Bankruptcy Act. P. 315 U. S. 515.

3. A tax, for the purposes of § 64(a)(4) of the Bankruptcy Act, includes any pecuniary burden upon individuals or property for the purpose of supporting the Government. P. 315 U. S. 515.

Page 315 U. S. 511

4. The provision of 902 of Title IX of the Social Security Act allowing the employer to credit against his tax, under § 901, the amount of his contributions to state unemployment funds up to 90% of the tax, does not make the tax to that extent a penalty, within the meaning of § 57(j) of the Bankruptcy Act, as applied to an employer who has failed to make such contributions. P. 315 U. S. 516.

5. In determining the amounts distributable to the United States on its tax claim and to the State for its unemployment fund, under §§ 901 and 902 of Title IX of the Social Security Act, from a bankrupt estate whose assets were insufficient to satisfy these and other claims of priority, held that the allowance to be made for the state fund should be credited against the total tax claim of the United States under § 901, rather than against the amount actually available for such claim. P. 315 U. S. 520.

118 F.2d 537 reversed.

Certiorari, 314 U.S. 592, on cross-petitions, to review a judgment reversing part of an order of the District Court, 38 F.Supp. 976, for the distribution of assets of a bankrupt estate.

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