Case Summary:
Debtors claimed a tax refund as exempt. The IRS sought to setoff its tax claim against the refund. The Court concluded that the debtors’ discharge did not impact the creditor’s right to setoff under 11 U.S.C. § 553. The Court also concluded that the right of setoff exists, even against property the debtors claim as exempt.

Statute/Rule References:
11 U.S.C. § 522(c) -- Exemptions - As Against Federal Tax Liens
11 U.S.C. § 553 -- Setoff

Key Terms:
Exemptions - Federal Tax Lien
Setoff