                                                          FILED
 1                         ORDERED PUBLISHED                FEB 04 2013
                                                       SUSAN M SPRAUL, CLERK
 2                                                       U.S. BKCY. APP. PANEL
                                                         O F TH E N IN TH C IR C U IT

 3                  UNITED STATES BANKRUPTCY APPELLATE PANEL
 4                            OF THE NINTH CIRCUIT
 5
 6   In re:                        )      BAP No.    NV-12-1439-JuKiD
                                   )
 7   EUGENE SCOTT NEWMAN, JR.,     )      Bk. No.    11-28663-LBR
                                   )
 8                  Debtor.        )
     ______________________________)
 9                                 )
     EUGENE SCOTT NEWMAN, JR.,     )
10                                 )
                    Appellant,     )
11                                 )
     v.                            )      O P I N I O N
12                                 )
     LENARD SCHWARTZER, Chapter 7 )
13   Trustee,                      )
                                   )
14                  Appellee.      )
     ______________________________)
15
16                  Argued and Submitted on January 25, 2013
                              at Las Vegas, Nevada
17
                            Filed - February 4, 2013
18
               Appeal from the United States Bankruptcy Court
19                       for the District of Nevada
20        Honorable Linda B. Riegle, Bankruptcy Judge, Presiding
21                    _____________________________________
22   Appearances:     Malik W. Ahmad, Esq., Law Office of Malik W.
                      Ahmad, appeared for appellant Eugene Scott
23                    Newman, Jr.; Lenard E. Schwartzer, chapter 7
                      trustee appeared pro se
24                    ____________________________________
25
     Before:   JURY, KIRSCHER, and DUNN Bankruptcy Judges.
26
27
28
 1   JURY, Bankruptcy Judge:
 2
 3        Chapter 71 debtor Eugene Scott Newman, Jr., appeals the
 4   bankruptcy court’s order granting the motion to compel turnover
 5   of debtor’s 2011 tax refund in the amount of $4,727 brought by
 6   chapter 7 trustee Lenard Schwartzer.     We AFFIRM.
 7                               I.   FACTS
 8        Debtor and his spouse are married and residents of Nevada.
 9   On December 2, 2011, debtor filed his individual chapter 7
10   petition.   Debtor’s schedules did not list his 2011 tax refund
11   as an asset nor did he claim any portion of the refund exempt.
12        In January 2012, debtor made three amendments to his
13   Schedules B and C which related to vehicles.
14        On March 12, 2012, debtor received his discharge.2
15        On May 1, 2012, the trustee sent debtor a letter requesting
16   a copy of his 2011 tax return.    Debtor complied.    The jointly
17   filed tax return showed a refund of $5,135 due.
18        On May 11, 2012, the trustee sent debtor a second letter
19   stating that a portion of the refund, in the sum of $4,727,
20   constituted property of the estate under § 541 and thus was
21   subject to turnover under § 542(a).      The letter further stated
22
          1
23          Unless otherwise indicated, all chapter and section
     references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1532.
24   “Rule” references are to the Federal Rules of Bankruptcy
     Procedure and “Civil Rule” references are to the Federal Rules
25   of Civil Procedure.
26        2
            We take judicial notice of the docket of the underlying
27   bankruptcy case and the imaged documents attached thereto. See
     O’Rourke v. Seaboard Sur. Co. (In re E.R. Fegert, Inc.), 887
28   F.2d 955, 957–58 (9th Cir. 1989).

                                      -2-
 1   that debtor could claim an exemption for the earned income
 2   credit if debtor filed an amended Schedule C.
 3        On May 22, 2012, debtor’s counsel sent an email to the Help
 4   Desk at the bankruptcy court stating:
 5        I have the following cases to reopen for changes in
          the schedules3. . . . Do I need to pay the reopening
 6        case fee of $269 in each case. These folks have been
          discharged. The procedural question is if the fee is
 7        payable after discharge or after the closure of the
          case. As usual thanks for your help.
 8
 9        On May 23, 2012, the Help Desk responded:    “Yes, the
10   reopening fee needs to be paid in each case with that motion.
11   Thank you.”
12        On May 30, 2012, debtor’s counsel filed an ex parte motion
13   to reopen debtor’s case even though debtor’s case was not
14   closed.
15        On July 9, 2012, the trustee moved for an order compelling
16   turnover of the 2011 tax refund in the amount of $4,727 and for
17   sanctions of $250 (Turnover Motion).
18        On July 16, 2012, debtor’s counsel filed an opposition to
19   the Turnover Motion arguing:    (1) the tax refund of the non-
20   debtor spouse was not property of the estate subject to
21   turnover; (2) the non-debtor spouse need not turn over her
22   portion of the refund due to the application of the Withholding
23   Rule, the Proportionate Income Rule, or the 50/50 Refund Rule;4
24
          3
              Counsel listed debtor’s case as well as Case No. 09-
25   32838.
26        4
            These rules reflect three approaches that various
27   bankruptcy courts have taken in allocating tax refunds between
     the debtor and non-debtor spouse. See In re Spina, 416 B.R. 92,
28                                                      (continued...)

                                      -3-
 1   (3) allocation of a joint tax refund is predicated upon
 2   consideration of many factors; and (4) the trustee’s motion to
 3   compel was “too late” because debtor and his spouse spent the
 4   money to pay utility bills, their mortgage and other
 5   expenditures.
 6        On August 9, 2012, the bankruptcy court heard the matter
 7   and granted the trustee’s Turnover Motion by order entered
 8   August 19, 2012.5
 9        On August 22, 2012, debtor amended his Schedule C to claim
10   the sum of $3,094 exempt under Nev. Rev. Stat. 21.0906, the
11
          4
12         (...continued)
     96-97 (Bankr. E.D.N.Y. 2009). The Withholding Rule “allocates
13   the joint tax refund between the spouses in proportion to their
     respective tax withholding.” Id. at 96. Under this rule, a
14   nondebtor spouse may have been employed but not have generated
     any withheld taxes, and, therefore, would have no right to any
15
     withheld taxes which are repaid to the taxpayer. Id. The
16   Proportionate Income Rule allocates the tax refund as a direct
     percentage of the earnings of the spouses. Id. The 50/50
17   Refund Rule, a minority view which applies New York matrimonial
     law, creates a rebuttable presumption that each spouse
18   contributed equally to the household, including nonmonetary
19   contributions, and, therefore, the refund should be divided
     equally between the spouses. Id. at 96-97. See also In re
20   Palmer, 449 B.R. 621 (Bankr. D. Mont. 2011) (adopting formula
     used by Internal Revenue Service to allocate tax refund).
21
          5
            Debtor has provided no transcripts in the record on
22   appeal.
23        6
              This section provides:
24
          1. The following property is exempt from execution,
25        except as otherwise specifically provided in this
          section or required by federal law:
26        . . .
          (aa) Any tax refund received by the judgment debtor
27
          that is derived from the earned income credit
28                                                      (continued...)

                                       -4-
 1   earned income exemption statute, and to claim an additional
 2   $1000 exempt under Nev. Rev. Stat. 21.090(1)(z), the wildcard
 3   exemption.   Debtor’s amended Schedule C does not identify the
 4   property to which the exemption applies, but we presume it is
 5   the tax refund at issue in this appeal.
 6        On August 22, 2012, the same date the amended Schedule C
 7   was filed, debtor filed a timely notice of appeal.
 8                              II.   JURISDICTION
 9        The bankruptcy court had jurisdiction over this proceeding
10   under 28 U.S.C. §§ 1334 and 157(b)(2)(A), (B) and (E).    We have
11   jurisdiction under 28 U.S.C. § 158.
12                                 III.    ISSUE
13        Whether the bankruptcy court erred in entering the turnover
14   order.
15                        IV.    STANDARD OF REVIEW
16        Whether property is included in a bankruptcy estate and
17   procedures for recovering estate property are questions of law
18   that we review de novo.     White v. Brown (In re White), 389 B.R.
19   693, 698 (9th Cir. BAP 2008).
20                               V.   DISCUSSION
21   A.   Debtor Did Not Exempt Any Portion of the Tax Refund Before
          the Bankruptcy Court Ruled
22
23        Debtor first contends that the bankruptcy court erred as a
24   matter of law in holding that debtor’s earned income credit of
25
26        6
           (...continued)
          described in section 32 of the Internal Revenue Code,
27
          26 U.S.C. § 32, or a similar credit provided pursuant
28        to a state law.

                                          -5-
 1   $3,094 is not exempted under Nev. Rev. Stat. 21.090.     This
 2   contention is erroneous.
 3        Debtor’s earned income credit exemption was not listed in
 4   his original Schedule B or C, nor did debtor amend his Schedules
 5   to claim the exemption in the tax refund prior to the bankruptcy
 6   court’s ruling on the trustee’s Turnover Motion.7   It was only
 7   after the bankruptcy court entered an order in favor of the
 8   trustee on the Turnover Motion that debtor filed his amended
 9   Schedule C and, even then, his amended Schedule does not
10   identify the property to which the exemption applies.8    Because
11   debtor’s amended Schedule C was not before the bankruptcy court
12   with respect to the order on appeal, we do not consider it now.
13   Oyama v. Sheehan (In re Sheehan), 253 F.3d 507, 512 n.5 (9th
14   Cir. 2001) (“Evidence that was not before the [trial] court will
15
          7
16          We are aware that the purported reason for the delay in
     amending Schedule C was debtor’s attorney’s mistaken belief that
17   before amending the Schedule, it was first necessary to obtain a
     court order reopening debtor’s case even though the case had not
18   yet been closed. As a result of his mistaken belief, debtor’s
     attorney claims that the amended Schedule C should be considered
19
     on the basis of excusable neglect. However, once the bankruptcy
20   court entered the order granting the trustee’s Turnover Motion,
     debtor’s remedy was to file a motion under Civil Rule 59, as
21   incorporated by Rule 9023, or file a motion under Civil Rule
     60(b), as incorporated by Rule 9024. Debtor did neither and
22   from what we can tell, debtor’s attorney now raises the issue of
23   his excusable neglect for the first time in this appeal. We
     address this argument in further detail below.
24        8
            Under Rule 1009(a), a debtor may amend his schedules as a
25   matter of course at any time prior to the closing of the case.
     Generally, “[t]he bankruptcy court has no discretion to disallow
26   amended exemptions, unless the amendment has been made in bad
     faith or prejudices third parties.” Arnold v. Gill (In re
27
     Arnold), 252 B.R. 778, 784 (9th Cir. BAP 2000) (citing Martinson
28   v. Michael (In re Michael), 163 F.3d 526, 529 (9th Cir. 1998)).

                                   -6-
 1   not generally be considered on appeal.”) (citing Karmun v.
 2   Comm’r, 749 F.2d 567, 570 (9th Cir. 1984)); see also Kirshner v.
 3   Uniden Corp. of Am., 842 F.2d 1074, 1078 (9th Cir. 1988)
 4   (“Papers not filed with the [trial] court or admitted into
 5   evidence by that court are not part of the clerk’s record and
 6   cannot be part of the record on appeal.”).   As it now stands,
 7   the order on appeal necessarily subsumes a determination that
 8   the tax refund at issue is nonexempt property of the estate.
 9   B.   The Tax Refund Was Property of Debtor’s Estate
10        Debtor next challenges the bankruptcy court’s conclusion
11   that the entire tax refund was property of his estate.   Section
12   541(a)(1) provides that property of the estate includes all
13   legal or equitable interests of the debtor in property as of the
14   commencement of the case.   Under § 541(a)(2), the estate also
15   includes “[a]ll interests of the debtor and the debtor’s spouse
16   in community property as of the commencement of the case that is
17   . . . under the sole, equal or joint management and control of
18   the debtor.”   (Emphasis added).
19        “[T]he right to receive a tax refund constitutes an
20   interest in property.”   Nichols v. Birdsell, 491 F.3d 987, 990
21   (9th Cir. 2007).   The nature and extent of the debtor’s interest
22   in the tax refund is determined by nonbankruptcy law.    Travelers
23   Cas. & Sur. Co. of Am. v. Pac. Gas & Elec. Co., 549 U.S. 443,
24   451 (2007) (citing Butner v. United States, 440 U.S. 48, 54–55
25   (1979)).   Nevada law applies here.
26        Under Nevada law, all property acquired by either spouse
27   during the marriage, with some exceptions not applicable here,
28   is community property.   Nev. Rev. Stat. 123.220; see Norwest

                                    -7-
 1   Fin. v. Lawver, 849 P.2d 324, 326 (Nev. 1993) (wages of either
 2   spouse during marriage are considered to be community funds
 3   regardless of which spouse earns the greater income or which
 4   spouse supports the community).     Spouses also have joint control
 5   of community property.   Either spouse may transfer or encumber
 6   community property without the consent of the other subject to
 7   several exceptions, which are not relevant here.    Nev. Rev.
 8   Stat. 123.230; Soper v. Crystal Palace Gambling Hall, Inc. (In
 9   re Crystal Palace Gambling Hall, Inc.), 36 B.R. 947, 950 (9th
10   Cir. BAP 1984).   Therefore, because the tax refund is community
11   property subject to the joint control of either spouse,
12   § 541(a)(2) “dictates that the entire prorated tax refund is
13   property of [d]ebtor’s bankruptcy estate.”    In re Martell, 349
14   B.R. 233, 236 (Bankr. D. Idaho 2005).9    We thus conclude that
15   the bankruptcy court properly found the tax refund was property
16   of debtor’s estate subject to turnover.
17   C.   The Bankruptcy Court Properly Ordered Turnover
18        Having concluded that the tax refund was property of
19   debtor’s estate, we next consider whether the trustee may compel
20   turnover of the property from debtor when he has spent the
21   funds.   Section 542(a) provides:
22        Except as provided in subsection (c) or (d) of this
23
          9
24          Debtor advocates that instead of applying Nevada’s
     community property law to this case, we should apply what is
25   known as the 50/50 Refund Rule. Debtor provides no cogent
26   reason — other than a favorable outcome for himself and non-
     debtor spouse — as to why this Panel should adopt a minority
27   view followed by a handful of bankruptcy courts in New York that
     apply New York matrimonial law. Simply put, New York is not a
28   community property state.

                                    -8-
 1        section, an entity, other than a custodian, in
          possession, custody, or control, during the case, of
 2        property that the trustee may use, sell, or lease
          under section 363 of this title, or that the debtor
 3        may exempt under section 522 of this title, shall
          deliver to the trustee, and account for, such property
 4        or the value of such property, unless such property is
          of inconsequential value or benefit to the estate.
 5
 6        Relying on Brown v. Pyatt (In re Pyatt), 486 F.3d 423 (8th
 7   Cir. 2007), debtor contends that by spending the funds, they are
 8   no longer in his “possession, custody or control” within the
 9   meaning of § 542(a).   In Pyatt, although the debtor had
10   approximately $1,900 in his bank account at the time his
11   petition was filed, the Eighth Circuit found that he could not
12   be compelled to turn over that amount when most of the funds
13   were used to honor prepetition checks that cleared soon after
14   his bankruptcy filing because the funds were no longer in his
15   possession or control.   In reaching this conclusion, the court
16   first reasoned that the language of § 542(a) said nothing about
17   whether the obligation to deliver the property to the trustee
18   continued after custody or control ceased.     Id. at 428.   Next,
19   citing Maggio v. Zeitz, 333 U.S. 56 (1948), the court observed
20   that pre-Code practice suggested that § 542(a) permitted a
21   trustee to compel turnover only from entities which have control
22   of property of the estate or its proceeds at the time of the
23   turnover demand.   Id. at 428-29.    The court also rejected the
24   argument that present possession was not required in light of
25   the statutory language that authorized the trustee to demand
26   turnover of the property, “or its value.”     According to the
27   Eighth Circuit, this language meant that if a debtor transferred
28   property of the estate and received value for it, “a trustee may

                                    -9-
 1   compel him to turn over the value of the property because he
 2   still has control over the proceeds of the property.”        Id. at
 3   429.
 4          Finally, the court expressed concern that if present
 5   “possession, custody or control” was not required, the “trustee
 6   could proceed both against the debtor and against the payees and
 7   obtain double satisfaction.”    Id. at 427.    The court noted that
 8   § 550(d) prohibited double satisfaction in avoidances under
 9   §§ 544, 545, 547-549, 553(b), and 724(a) but made no mention of
10   § 542(a).    The court reasoned:    “The absence of such a
11   prohibition suggests that the drafters did not intend to
12   authorize a trustee to proceed under § 542(a) against everyone
13   who may have had control over property of the estate at some
14   point after the petition was filed.”      Id. at 427-28.
15          The Pyatt ruling does not persuade us.    Among the Circuit
16   courts and Bankruptcy Appellate Panels that have addressed the
17   issue before us, Pyatt represents a minority view.10       The Fourth
18   and Seventh Circuits and the Sixth and Tenth Circuit bankruptcy
19   appellate panels do not require the debtor/defendant to have
20   present possession, custody or control of property when a demand
21   for turnover is made.    See Beaman v. Vandeventer Black, LLP (In
22   re Shearin), 224 F.3d 353 (4th Cir. 2000) (law firm, having
23   possessed year-end profits belonging to the debtor during the
24   pendency of his bankruptcy case, must turn over profits, or
25   their equivalent value, to the trustee, notwithstanding that the
26
            10
27          We note that the Nevada District Court has followed Pyatt
     in Shapiro v. Henson (In re Henson), 449 B.R. 109 (D. Nev.
28   2011).

                                        -10-
 1   law firm no longer possessed the funds at the time the turnover
 2   proceeding was filed); Boyer v. Carlton, Fields, Ward, Emmanuel,
 3   Smith & Cutler, P.A. (In re USA Diversified Prods., Inc.), 100
 4   F.3d 53, 56 (7th Cir. 1996) (“[B]y the time the trustee got
 5   around to demanding the money from the law firm, the law firm no
 6   longer had it, so how could it deliver it to the trustee?
 7   [Section 542], however, requires the delivery of the property or
 8   the value of the property.   Otherwise, upon receiving a demand
 9   from the trustee, the possessor of property of the debtor could
10   thwart the demand simply by transferring the property to someone
11   else.   That is not what the statute says, . . . and can’t be
12   what it means.”) (emphasis in original); Bailey v. Suhar (In re
13   Bailey), 380 B.R. 486, 491-93 (6th Cir. BAP 2008) (portion of
14   tax refund which was property of the debtor’s estate retained by
15   attorney for unpaid attorney’s fees and no longer in the
16   debtor’s possession was subject to turnover); and Jubber v. Ruiz
17   (In re Ruiz), 455 B.R. 745 (10th Cir. BAP 2011) (requiring
18   turnover of the balance of funds in the debtors’ checking
19   account when petition was filed, prior to payment of checks that
20   debtors had written prepetition).
21        Recently, in the unpublished decision of Rynda v. Thompson
22   (In re Rynda), 2012 WL 603657 (9th Cir. BAP Jan. 30 2012),
23   another Panel of this court held that § 542(a) does not require
24   current possession under circumstances similar to those here.
25   In Rynda, the debtor filed a chapter 7 petition and did not list
26   her entitlement to tax refunds under state and federal law in
27   her Schedule B or claim such refunds exempt in her Schedule C.
28   After learning about the refunds, the trustee made a demand on

                                    -11-
 1   the debtor to turn over the refunds.       In response, the debtor
 2   asserted, among other things, that the funds were no longer in
 3   her possession — although she offered to make monthly payments
 4   to pay the amount of the refunds.       The trustee refused her
 5   proposal and filed a motion for turnover of the refunds under
 6   § 542.   After a hearing, the bankruptcy court issued a decision
 7   determining that a turnover order was appropriate if a debtor
 8   came into possession of estate property after filing a petition,
 9   even if the debtor no longer had possession of the property.
10   Id., at *1.   The debtor appealed.
11        On appeal, the Panel held that even though debtor no longer
12   possessed the funds, she was not relieved of her statutory
13   obligation “‘to deliver to the trustee and account for such
14   property’ or its value.”   Id., at *2.      “Section 542’s mandate
15   means that she must deliver property or pay over money to the
16   trustee.   The requirement is not waived because the debtor no
17   longer possesses the property.”    Id. (citation omitted).       In the
18   end, the Panel held that “since the Debtor had been in
19   possession of property of the estate, the Turnover Order was
20   appropriate even though the Debtor did not possess the funds at
21   the time the Trustee filed the Turnover Motion.”       Id., at *3.
22        Because we do not find Rynda distinguishable from this
23   case, we adopt its holding, but expand on its analysis in light
24   of debtor’s reliance on Pyatt.    We begin our analysis with the
25   language of § 542(a) itself.   United States v. Buckland, 289
26   F.3d 558, 564 (9th Cir. 2002) (en banc).       Under the plain
27   language of the statute “[t]he obligation to turnover extends
28   not just to property presently in someone’s possession, custody

                                      -12-
 1   or control but to property in its ‘possession, custody or
 2   control during the case.’”    Boyer v. Davis (In re USA
 3   Diversified Prods., Inc.), 193 B.R. 868, 874-75 (Bankr. N.D.
 4   Ind. 1995) (emphasis in original).     Here, there is no question
 5   that debtor was entitled to the tax refund on the petition date
 6   and that he received the refund post-petition.    Thus, debtor was
 7   in “possession, custody, or control” of the property “during the
 8   case” as required under the statute.
 9        Moreover, the plain language of the statute provides a
10   broader remedy than turnover of property itself.    Section 542(a)
11   provides that “an entity . . . in possession, custody, or
12   control, during the case, . . . shall deliver . . . and account
13   for, such property or the value of such property.”    (Emphasis
14   added).    “[I]f the statute [were] read to require current
15   possession of the property, the language allowing a trustee to
16   alternatively recover ‘the value of the property’ would become
17   superfluous, as the trustee could only recover the property
18   itself.”    In re Ruiz, 455 B.R. at 751.   The statute should not
19   be interpreted so as to render one part inoperative.      Id.
20        In addition, the pre-Code practice of requiring possession
21   must be viewed in context.    In Maggio, 333 U.S. 56, the trustee
22   brought a motion to hold Maggio in contempt for failing to turn
23   over property of the estate.    “Numerous courts, including
24   Maggio, were troubled by the possibility that a turnover order
25   might be issued against a party who could not possibly comply
26   with it, because the property in question was no longer in its
27   possession, and then attempt to force that party to do the
28   impossible through contempt proceedings.”    In re USA Diversified

                                     -13-
 1   Prods., Inc., 193 B.R. at 876.    Even then, if the party did not
 2   have present possession, it only meant that the trustee could
 3   not seek to enforce turnover through contempt, but instead was
 4   required to initiate a plenary proceeding in an effort to obtain
 5   a money judgment for what the turnover respondent no longer
 6   possessed.   Id. at 877.   Considered in this context, the United
 7   States Supreme Court in Maggio “held that turnover was
 8   appropriate only ‘when the evidence satisfactorily establishes
 9   the existence of the property or its proceeds, and possession
10   thereof, by the defendant at the time of the [turnover]
11   proceeding.’”    In re Bailey, 380 B.R. at 491 (quoting Maggio,
12   333 U.S. at 63-64).    Whatever the procedures then, the plain
13   language of § 542(a) has no “present possession” requirement.
14        We also conclude that the Pyatt court’s concern with a
15   trustee’s double recovery is unfounded.    Section 550(d)’s
16   prohibition on double recovery references statutes that relate
17   to the trustee’s avoidance powers (§§ 544, 545, 547–549, 553(b)
18   and 724(a)).    Because § 542(a) addresses not avoidance, but
19   turnover of property of the estate, “little, if anything, should
20   be read into the failure to include § 542(a) in the provisions
21   of § 550.”   In re Ruiz, 455 B.R. at 751-52.   Moreover, “if a
22   trustee sought a double recovery, the party from whom the second
23   recovery was sought could raise as an equitable defense to
24   turnover that the bank account constituted effectively a single
25   asset, and the trustee should not be able to recover the same
26   asset twice.”    Id. at 752.
27        The upshot of this analysis is clear:     even though debtor
28   no longer possessed the funds, he was not relieved of his

                                      -14-
 1   statutory obligation “‘to deliver to the trustee and account for
 2   such property’ or its value.”   Rynda, 2012 WL 603657, at *2.
 3   Our conclusion is consistent with the Ninth Circuit’s holding in
 4   Nichols, 491 F.3d 987.   In that case, the issue was whether the
 5   debtors’ overpayment of taxes, which entitled them to an
 6   immediate refund, was property of their estate subject to
 7   turnover.   The debtors elected to leave the overpayments on
 8   deposit with the United States and the State of Arizona and to
 9   apply the overpayments to their future tax liability.   Upon
10   discovery, the trustee required debtors to turn over the unpaid
11   balance on their taxes to the estate.   The Ninth Circuit held
12   that the right to receive a tax refund constituted an interest
13   in property and, therefore, it followed that the debtors’
14   election to waive the carryback and relinquish the right to a
15   refund necessarily implicated a property interest.   The court
16   determined that the debtors had exchanged a right to present
17   property for the right to it later and thus the value of the tax
18   credit was subject to the trustee’s avoidance powers.   Thus,
19   even though the funds were not presently in the debtors’
20   possession, the trustee had authority to compel turnover of the
21   value of the tax credit from the debtors.   Compare United States
22   v. Gould (In re Gould), 401 B.R. 415 (9th Cir. BAP 2009) (fact
23   that the debtor had spent tax refund which he was not entitled
24   to did not make Internal Revenue Service’s appeal moot because
25   debtor could be ordered to pay back the money), aff’d, 603 F.3d
26   1110 (9th Cir. 2010).
27        In sum, we hold that § 542(a) does not require the debtor
28   to have current possession of the property which is subject to

                                     -15-
 1   turnover.    “If a debtor demonstrates that [he] is not in
 2   possession of the property of the estate or its value at the
 3   time of the turnover action, the trustee is entitled to recovery
 4   of a money judgment for the value of the property of the
 5   estate.”    Rynda, 2012 WL 603657, at *3.   In addition, the refund
 6   here, approximately $5,000, cannot be viewed as having an
 7   insignificant value to the estate.11    Accordingly, the bankruptcy
 8   court properly granted the trustee’s Turnover Motion.
 9   D.   Civil Rule 60(b) and Excusable Neglect
10        Debtor’s attorney argues on appeal that his failure to file
11   amended Schedule C prior to the hearing on the Turnover Motion
12   constitutes excusable neglect.    Civil Rule 60(b)(1) grants
13   bankruptcy courts discretion to relieve a party from a judgment
14   or order for reason of “mistake, inadvertence, surprise, or
15   excusable neglect,” provided that the party moves for such
16   relief not more than a year after the judgment was entered.
17        A Civil Rule 60(b) motion must be made in the bankruptcy
18   court.    After entry of the order granting the trustee’s Turnover
19   Motion, debtor made no such motion for the bankruptcy court to
20   consider.    At the hearing on this matter, the Panel urged
21   debtor’s counsel to proceed with the filing of a Civil Rule
22   60(b) motion because we generally do not decide issues on appeal
23   that were not first presented to the bankruptcy court.     In re
24   E.R. Fegert, Inc., 887 F.2d at 957.     Debtor must seek this
25
          11
26          Although debtor contends the amount recovered by the
     trustee would be inconsequential because he is entitled to
27   claimed exemptions, as previously explained, the issue of
     whether he is entitled to any exemption is not properly before
28   us in this appeal.

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 1   relief in the bankruptcy court.
 2                           VI.   CONCLUSION
 3        For the reasons stated, we AFFIRM.
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