Case Explained: In re BERNARDO ROMERO Debtor

Court: United States Court of Appeals for the Seventh Circuit

Filed: 2026-07-16

The Seventh Circuit affirmed the bankruptcy court’s determination that a property tax purchaser in Illinois holds a “tax claim” under 11 U.S.C. § 511(a) of the Bankruptcy Code, thereby entitling the creditor to an interest rate determined by applicable nonbankruptcy law rather than the market-based formula established in *Till v. SCS Credit Corp.* The court held that because the tax purchaser steps into the shoes of the county and acquires a right to collect overdue property taxes, the claim qualifies as a “tax claim” within the meaning of § 511(a). Consequently, the applicable interest rate is not the 12% redemption penalty or the *Till* formula, but rather the 18% annual rate specified in 35 ILCS 200/21-15 of the Illinois Property Tax Code, which governs interest on unpaid taxes when a county foregoes a tax sale. The practical consequence is that the debtor must pay the secured creditor’s claim at an 18% interest rate under the Chapter 13 plan. Additionally, the court declined to strike the appellee’s brief or impose sanctions regarding alleged AI-generated hallucinations in citations, noting that while the errors reflected a lack of care, they did not materially affect the presentation of the appeal, though the court issued a general reminder to the bar regarding diligence in legal filings.

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