Category: Bankruptcy

Do You Need a Lawyer to File Chapter 13 Bankruptcy? – Guest Post

  

Bankruptcy

Filing for Chapter 13 bankruptcy can be a practical solution for individuals struggling with overwhelming debt. Unlike Chapter 7 bankruptcy, which involves liquidating assets to pay creditors, Chapter 13 allows debtors to reorganize their debts and create a repayment plan spanning three to five years. While it is legally possible to file for Chapter 13 bankruptcy without an attorney, the complexity of the process raises an important question: do you need a lawyer to file successfully? Understanding the role of a bankruptcy lawyer, the risks of proceeding without one, and the benefits of legal representation is crucial when considering Chapter 13 bankruptcy.

The Complexity of Chapter 13 Bankruptcy

Chapter 13 bankruptcy is governed by intricate federal laws and involves strict procedural requirements. The process begins with filing a detailed petition with the bankruptcy court, which includes financial disclosures, a proposed repayment plan, and documentation of income, assets, and liabilities. These documents must be accurate and complete, as errors or omissions can lead to delays, dismissals, or unfavorable rulings.

In addition to preparing documentation, filers must comply with court deadlines, attend hearings, and negotiate with creditors. The repayment plan must meet specific criteria, ensuring that creditors receive at least as much as they would under a Chapter 7 liquidation. The court must approve the plan, and any objections from creditors or the trustee must be addressed. Given these complexities, even minor mistakes can have consequences, making the guidance of an experienced bankruptcy attorney invaluable.

The Role of a Bankruptcy Lawyer

A bankruptcy lawyer provides essential guidance throughout the Chapter 13 process. From the initial consultation, the lawyer evaluates the client’s financial situation, determines eligibility for Chapter 13, and outlines the benefits and drawbacks of filing. An attorney also assists in developing a realistic and compliant repayment plan that satisfies court requirements while aligning with the client’s financial capacity.

Beyond documentation, a bankruptcy lawyer represents the client at the confirmation hearing, where the court reviews and approves the repayment plan. The attorney addresses objections from creditors and the trustee, ensuring that the client’s interests are protected. Should disputes arise during the repayment period, such as missed payments or changes in financial circumstances, the lawyer helps modify the plan or addresses legal challenges.

Moreover, bankruptcy attorneys possess a thorough understanding of bankruptcy laws, court procedures, and trustee expectations. Their experience ensures that the case proceeds efficiently, reducing the risk of dismissal and increasing the likelihood of a favorable outcome. In essence, a bankruptcy lawyer serves as a crucial advocate, providing strategic advice and legal representation throughout the process.

Risks of Filing Without an Attorney

While self-representation is legally permissible in bankruptcy cases, it carries risks. Statistics show that individuals who file Chapter 13 without legal representation have a lower success rate than those who hire attorneys. One primary reason is the difficulty of crafting a feasible repayment plan that meets court requirements. Plans that are unrealistic or fail to meet legal standards are likely to be rejected, leading to case dismissal.

Additionally, the bankruptcy code contains complex provisions that may not be readily understood by individuals without legal training. Misinterpreting these provisions can result in critical errors, such as incorrect calculations of disposable income or failure to account for non-dischargeable debts. Such mistakes can jeopardize the entire case and leave the filer without the intended financial relief.

Filing without an attorney also means navigating court procedures independently. Missing deadlines, failing to submit required documents, or inadequately addressing creditor objections can result in the dismissal of the case. Restarting the process after a dismissal often involves additional costs and may impose restrictions on future filings. Given these risks, self-representation in Chapter 13 bankruptcy can lead to costly and avoidable pitfalls.

Benefits of Legal Representation

Hiring a bankruptcy lawyer offers several key advantages that can impact the outcome of a Chapter 13 filing. One of the most critical benefits is the development of a tailored repayment plan that balances the client’s ability to pay with the court’s legal requirements. Attorneys possess the expertise to structure plans that are realistic, compliant, and likely to gain court approval.

Legal representation also ensures that the client’s rights are protected throughout the bankruptcy process. Creditors may challenge aspects of the repayment plan, claim certain debts are non-dischargeable, or seek to lift the automatic stay. A bankruptcy lawyer handles these challenges, advocating for the client’s best interests and ensuring fair treatment under the law.

Furthermore, a bankruptcy lawyer streamlines the filing process, ensuring that all required documents are prepared accurately and submitted on time. This reduces the likelihood of errors that could result in delays or dismissals. Attorneys also provide valuable advice on managing finances during the repayment period, increasing the chances of completing the plan successfully.

Filing for Chapter 13 bankruptcy is a demanding process that requires a thorough understanding of federal laws, court procedures, and financial planning. While it is legally possible to file without an attorney, the risks associated with self-representation are considerable. A Chapter 13 bankruptcy lawyer provides essential guidance, helping filers develop compliant repayment plans, navigate court procedures, and address creditor objections.

What legal provisions and defenses may you get being accused of Bankruptcy Fraud? – Guest Post

   

accused of Bankruptcy Fraud

Sometimes people or businesses apply for bankruptcy in a federal bankruptcy court when they acquire more debt than they can handle.

When someone declares bankruptcy, creditors can no longer sue that person or seize the assets to pay off outstanding debts.

Instead, creditors must appear in bankruptcy court, where the debtor filed the bankruptcy petition. There, a judge will decide how much property the debtor owns, how much money you owe, and who gets paid back.

The procedure is intended to give debtors a fresh start by enabling them to escape their crippling debts.

What is called Bankruptcy Fraud under Federal Law?

It is a federal felony when individuals exploit this provision by dishonestly filing for bankruptcy out of fraud and gaining an unfair benefit. False statements or representations made during the bankruptcy process are illegal under 18 U.S. C. 157.

Criminal bankruptcy fraud is a federal crime committed when a person files for bankruptcy, hides assets and makes false statements under penalty of perjury, files a false claim, destroys or hides financial records crucial to the case, or offers or accepts bribes.

A common allegation in bankruptcy fraud investigations is that the following actions were committed:

  • They began a bankruptcy case intending to commit fraud.
  • To perpetrate fraud, they submitted a paper to a bankruptcy court.
  • They submitted a bankruptcy petition with false or fraudulent statements and claims with the intent to commit fraud.

Federal prosecutors in a bankruptcy fraud prosecution will verify first whether or not the defendant had fraudulent intent.

What are some common examples of bankruptcy fraud?

Bankruptcy fraud can refer to a wide variety of actions and behavioral standards concerning the filing of bankruptcy applications. Let’s examine some of the most common.

Hiding own assets at the time of application

It is one of the most common bankruptcy fraud by far. All of your assets must be disclosed to the court when you initiate the procedure of filing bankruptcy. This includes information on your cash in bank accounts, assets such as real estate and investments, and personal properties.

The court will use these assets to calculate how much of your debt you can pay during the bankruptcy process and then allocate to your creditors as necessary.

However, some people try to hide their wealth by putting it in the names of friends or family members, creating fictitious companies to conceal ownership, putting it in offshore accounts, etc.

Showing the lower value of the assets while filing the application

When you file for bankruptcy, accurately stating the worth of your assets is just as crucial as admitting their existence. All your assets must be listed at their fair market value, although some try to undervalue them to keep more possessions and make smaller payments to creditors.

Making an incorrect representation or statement

Making misleading representations on your bankruptcy petition or other associated paperwork is another typical instance of bankruptcy fraud.

Lying about your earnings, expenses, debts, possessions, or business interests falls under this category.

False information given to your bankruptcy trustee or creditors is also included. For instance, if you’re self-employed and attempting to conceal your income, you can inflate your business costs to lower the taxes you have to pay.

Bribery

When a debtor attempts to bribe a creditor, bankruptcy fraud may also occur. After the debtor files for bankruptcy, creditors are not compelled to submit a claim against the debtor.

For instance, the debtor can offer to pay the creditor cash in exchange for the creditor agreeing not to file a claim to persuade them.

Petition Mills

A company that aids people in filing for bankruptcy illegally is known as a bankruptcy petition mill.

These companies often charge clients fees to assist clients with asset concealment, property transfers to friends and family, and fraudulent court applications.

To put off or avoid paying off debts, they could also advise their clients to file for bankruptcy many times. You may be held accountable for this offense if you establish or maintain a petition mill to promote bankruptcy fraud.

Scams to save homeowners and renters

Consumers in danger of eviction or foreclosure are the target of another sort of bankruptcy scam. The deception involves a company that demands customer payment to prevent foreclosure or eviction.

However, these con artists often file a bankruptcy petition in the victim’s name after they have been paid, frequently without the victim’s knowledge or approval.

Although this temporarily postpones the foreclosure or eviction, it does not prevent it because the court will dismiss the case as soon as it determines that you were not involved in the filing.

After that, the foreclosure process will resume, and the con artists will be gone with the money, leaving no trace.

What are the possible legal penalties for bankruptcy fraud?

Bankruptcy is one of the main options to eliminate your financial obligations. But that doesn’t mean you have the right to manipulate the laws. If you do that, the degree and type of your offense will determine the punishments for Section 157 bankruptcy fraud. The following factors can have a significant impact on your federal sentence:

  • Equitable factors that are related to the defendant’s history and character.
  • Application of the United States Sentencing Guidelines.
  • Exercise of the sentencing court’s broad discretion.
  • Other policy considerations as enumerated in 18 U.S.C. § 3553(a).

Probable civil penalties

Loss of discharge rights

Once the bankruptcy procedure is complete, your creditors can no longer initiate collection efforts against you, giving you the opportunity for a fresh start. It is referred to as a discharge of debt.

The court may not grant you a discharge if you commit bankruptcy fraud, allowing your creditors to sue you, seize your assets, and engage in any other collection activities that bankruptcy would usually shield you from.

Decreased exemptions

Although you must disclose all of your assets to the court when you file for bankruptcy, this does not indicate that your entire estate can be utilized to settle debts with creditors.

Some of your possessions will be excluded, allowing you to keep them regardless of your debt.

The court may reject those exemptions and allow your creditors to seize the property that would have otherwise been yours if you file for bankruptcy while acting fraudulently.

Probable criminal penalties

Imprisonment

An individual found guilty of bankruptcy fraud faces a maximum 5-year prison term. This is the maximum punishment; therefore, a judge might give you a term of up to five years.

However, if you engage in multiple acts of bankruptcy fraud, the court may impose a maximum penalty of five years per violation.

Probation

In cases involving bankruptcy fraud, probation is also an option. When a court sentences you to probation, you must abide by specific rules for the probationary period, such as attending meetings with the probation officer and refraining from committing additional offenses.

Although more extended penalties are conceivable, probation typically lasts one to three years.

Monetary charges

Fraudulent bankruptcy penalties might be extremely high. Each count or distinct act of fraud is punishable by a fine of up to $250,000.

These fines may be enforced separately or in addition to imprisonment or other forms of punishment.

Possible defenses against Federal Bankruptcy Fraud charges

Federal authorities may examine bankruptcy files and proceedings under Chapter 7, Chapter 13, and Chapter 11 for any indications of impropriety or fraud.

When there is a suspicion of fraud, the case is forwarded to the FBI or the U.S. Attorney’s office for investigation, which may stop the bankruptcy process, lead to a criminal indictment, or both. The federal government aggressively investigates and prosecutes federal bankruptcy fraud offenses.

But remember that to prove that you committed such a crime, the government must prove each specific element of the crime to the point where there is no other logical explanation for the evidence presented in court. To prove bankruptcy fraud against you in federal court, the prosecution must prove that you had the genuine intent to commit fraud.

So, if you are innocent, you must immediately contact a skilled criminal defense lawyer in your area whenever your activities potentially result in civil or criminal fraud. You might need to consult a criminal defense attorney even if you already have bankruptcy counsel.

Only a lawyer with experience in criminal law can give you the guidance you need to safeguard yourself from being charged with bankruptcy fraud in a court of law. Some bankruptcy attorneys lack this kind of criminal justice background.

Essential defense strategies regarding bankruptcy fraud

Most federal bankruptcy fraud cases have a five-year statute of limitations, which entails the administration filing an indictment within five years of the alleged offense to bring federal charges against the fraud accused.

You need a defense lawyer on your side who is knowledgeable about the different defenses to federal bankruptcy fraud if you have been suspected of engaging in it in violation of federal law, such as the following:

  • Unintentional mistake – You unintentionally omitted to mention the transfer of a significant asset in your bankruptcy petition.
  • Legit reason – The alleged conduct you committed was done to achieve a legal goal (i.e., selling an asset for half its worth to get a tax deduction).
  • Withdrawal or renunciation – You regretted your deliberate omission of an asset or corrected an error as soon as you realized it.
  • Statute of limitations – The bankruptcy fraud statute of limitations has passed.
  • Lack of wrong intent – You have no intention of defrauding anyone.
  • Insufficient proof – The prosecution doesn’t have sufficient proof to establish the offense beyond a reasonable doubt.

Author Bio: Lyle Solomon has extensive legal experience, in-depth knowledge, and experience in consumer finance and writing. He has been a member of the California State Bar since 2003. He graduated from the University of the Pacific’s McGeorge School of Law in Sacramento, California, in 1998 and currently works for the Oak View Law Group in California as a principal attorney.

What are the consequences of filing for bankruptcy – Guest Post

   

consequences of filing for bankruptcy

If you or your business is in debt, you’ve probably been weighing up your options to find a solution.

There are a number of options out there, including bankruptcy. Declaring yourself bankrupt may be a way to be released from certain debts, however, there are a number of consequences which may affect you, and these consequences could affect you for quite some time.

So, if you find yourself drowning in debt, before you make any major decisions, it’s important you understand the consequences of making the decision to declare bankruptcy.

In this piece, we’re going to discuss what bankruptcy is, what actually happens when you declare bankruptcy and what the consequences of bankruptcy.

What is bankruptcy?

Bankruptcy, also referred to as declaring bankruptcy is a process where a person is legally declared as being unable to pay their debts. The individuals who are declared bankrupt give up their assets and the rights to control their own finances.

How does someone become bankrupt?

Bankruptcy can happen either by voluntarily entering into bankruptcy or by receiving a bankruptcy notice and proceedings.

When you cannot pay your debts, you can choose to become bankrupt voluntarily. This type of bankruptcy is referred to as a debtor’s petition and you must be insolvent, where you are unable to pay your debts when they are due. To voluntarily enter into bankruptcy you need to complete a bankruptcy application form which will be assessed by the Australian Financial Security Authority. If the application is approved, then a trustee is appointed to manage your debts and finances.

If you receive a bankruptcy notice, this means that your creditors – the people you owe money – have decided to take action against you. Your creditors can issue a bankruptcy notice against you if they believe that you are unable to pay your debts. If you do not respond to the bankruptcy notice, the creditors are able to commence proceedings, which includes issuing a bankruptcy petition to the court. Similar to when you enter into bankruptcy voluntarily, if a court sides with the creditors, then an order may be made where a trustee will be appointed to manage your debts and finances.

Are there any benefits to declaring bankruptcy?

Bankruptcy is often seen as a negative, and while there are serious consequences that must be taken into account, there are also some benefits of bankruptcy too.

The first major benefit is that you are released from most kinds of debt, which can remove a portion of stress from your life and provide you with an opportunity to be able to start afresh. Being released from these debts usually means that you’ll no longer face creditors chasing you for their money. Depending on the level of debt that you’re in, you could experience harassment from creditors.

You also avoid further legal proceedings in most instances. If legal proceedings have commenced, then these will continue through your trustee.

What are the consequences of becoming bankrupt?

There are a number of consequences to declaring or becoming bankrupt. Some of these are longer lasting than others. These can impact various areas of your life and include:

Types of debts you can be released from

While being declared bankrupt does release you from most debts, there are exceptions to this. If you have any penalties or fines imposed by a court, you will be required to pay them. If you pay child support or spousal maintenance, you will likely still be required to make these payments. You aren’t released from HECS or Fee-Help debts, nor unliquidated debts. When you’re working through the bankruptcy process, it’s a good idea to work with an experienced bankruptcy lawyer who can provide clarity over the types of debts that you may be released from.

Employment

Being declared bankrupt can mean that if you work in a job where you are earning over a certain threshold, you may have money deducted from your wage.

When it comes to your employment, you may face restrictions on the types of industries you can work in. And you can be restricted in the types of roles you can work in as well. For example, you will likely be restricted from being able to be a company director. This restriction could be temporary or permanent.

Starting your own business and running it yourself can be put in jeopardy if you are declared bankrupt.

Travel Restrictions

You may not be able to travel internationally if you are declared bankrupt. Usually, a person who has been declared bankrupt needs the permission of the trustee to be able to travel overseas. It is considered a crime to do so without this permission.

Access to Credit in the Future

Your ability to borrow money from creditors may be inhibited as you will be required to disclose your recent financial history to lenders. You may be further restricted in the amount that you can borrow from creditors as well.

Should you declare bankruptcy?

Whether you should declare bankruptcy or not is not a decision to be taken lightly. Declaring bankruptcy has serious consequences, however, it can also offer significant release.

Before making any decision about your financial future, it’s important to understand the consequences and all of your options. This is where the help of an experienced bankruptcy lawyer can help you.

Their expertise allows them to assess your unique circumstances and provide you with your various options so you can make an informed decision about your future.

Don’t make any rash decisions when it comes to your finances and your future, seek legal advice today.

What Are the Steps to Filing for Bankruptcy? – Guest Post

   

Bankruptcy

Bankruptcy, it’s a scary word to many people. However, bankruptcy is not necessarily all doom and gloom. Instead, bankruptcy is meant to alleviate financial burdens and give you a fresh start. By wiping the financial slate clean, so to speak, bankruptcy can provide financial freedom and give filers a chance to learn and grow from past financial mistakes.

Steps to Take When Filing Bankruptcy

In general, a bankruptcy proceeding, no matter what type of bankruptcy, can be broken down into 6 steps. However, it is important to understand that everyone’s financial situation differs. For example, some people may have a business involved, others may have little to no assets at hand. The steps required also depend upon the type of bankruptcy (chapter 7 or chapter 11) that best fits your particular financial situation. Your finalized to-do list will most accurately be provided to you by an experienced bankruptcy attorney.

Contact an Attorney

Perhaps the most important step in filing bankruptcy is to work closely with a bankruptcy attorney. A competent attorney will be able to analyze your financial situation, see if you qualify for bankruptcy, and help guide you through the intricacies of the process.

Evaluate Your Financial Situation

When filing bankruptcy, it is always a good idea to have a clear picture of your overall financial situation. It is important to be brutally honest with both yourself and your attorney regarding your assets and debts. Remember bankruptcy is meant to give you a fresh financial start, if you hide debts from the process, you will not receive a truly blank slate.

Collect and Turn in Appropriate Paperwork

As with most adult chores, bankruptcy requires quite a bit of paperwork. Most of this paperwork your attorney will be able to handle for you. However, certain documents will need to be collected by you and signed by you. Although tedious, this part of the process is fairly painless.

Attend Your Hearing

After submitting all the required documentation and paperwork, and dependent on the type of bankruptcy you file, you will be asked to attend a hearing. At this hearing, you will be asked a series of questions to make sure that your request is truthful and accurate. In most cases, there will be several other people in the room who are also filing bankruptcy and following through with their hearing. Although this step sounds daunting it is usually a quick formality to handle.

Take a Credit Counseling Course

All persons who file bankruptcy must complete a credit counseling course to finalize their bankruptcy. In this (typically online) course you will receive helpful budgeting tips and counseling on how to properly handle finances in the future.

Finalize Your Bankruptcy

Once all the above steps are completed you can finally finalize your bankruptcy. All in all the process typically takes a couple of months to finalize through the government. However, when complete, you now have a new lease on life and financial freedom to begin again.

A Word of Caution: Things to Not Do When Filing Bankruptcy

Just as there are steps you should take when filing bankruptcy, there are a number of things that you should not do when filing bankruptcy. Here is a shortlist of things not to do right before or during your bankruptcy proceedings:

Rack up Credit Card Debt: Do not intentionally max out all of your credit cards immediately prior to filing bankruptcy, with the intention of never repaying them due to your bankruptcy. This is a red flag to both the government and creditors alike to what you’re planning, and as a result, will not work.

Lie about your assets or debt: In order for a bankruptcy proceeding to go smoothly it is important to be transparent with your bankruptcy attorney about all of your debts and assets

Do not take on any new debt: Opening a new car loan or attempting to acquire a mortgage right before or during bankruptcy is never a good idea. If you have a financial need or goal, consult with your bankruptcy attorney on the best course of action. In many instances, patience is the only option.

Transfer property to family or friends: Attempting to “save” property from being collected during bankruptcy by transferring it to family or friends right before bankruptcy could be viewed as fraudulent behavior. Once you are aware that bankruptcy is your chosen path, consult with your attorney before making any changes to your financial situation.

How can you discharge tax debts in bankruptcy when the timing is right? – Guest Post

   

tax debts in bankruptcy

Be wary of greedy companies or financial service providers who claim to eliminate tax debts through bankruptcy. It’s not as easy as it seems. But genuine tax debt relief companies or attorneys will tell you that most tax debts aren’t dischargeable in bankruptcy. You’ll still need to pay them at the end of a Chapter 7 case. Apart from that, paying off tax debt in full under a Chapter 13 repayment plan will be your next option.

However, suppose you wish to discharge tax debts imminently. In that case, Chapter 7 bankruptcy is the better alternative, but only when your tax liability qualifies for discharge and you qualify for Chapter 7 bankruptcy.

When can you discharge tax debt?

Before you can use Chapter 7 bankruptcy and reduce tax debt, you must meet the following requirements:

The tax debt should be at least three years old

Before filing bankruptcy, the tax return had to be due for at least three years.

The taxes should be income taxes

To get tax debt relief, your income should be taxed under federal taxes. Other taxes, including payroll taxes or fraud penalties, cannot be discharged in bankruptcy.

You must have filed tax returns

Bankruptcy must have been filed at least two years before you want to get rid of debt. You can’t get out of paying taxes in most court proceedings if you file a late return. The IRS may issue a substitute return on your behalf, considering your extensions have run out and you haven’t filed a “return.” Courts in some places let people get rid of a tax debt caused by a late return if they meet other criteria.

You shouldn’t perform fraudulent activities or intentionally avoid taxes

In this case, bankruptcy can’t provide you with tax debt help. If you submitted a deceptive tax return or tried to escape paying off tax debt, bankruptcy couldn’t guide you.

You comply with the “240-day rule.”

The IRS should have calculated your tax debt at least 240 days before you submit your chapter 7 bankruptcy, or you will not be able to file it. If the IRS suspends collection operations due to an offer in settlement or a past bankruptcy filing, the time limit may be extended.

There are also additional criteria in some regions. Also, if you used a credit card to pay off a nondischargeable tax debt under Chapter 7, the credit card amount will be a nondischargeable debt as well.

What are the 3 time specific rules that can help you discharge tax debt?

There are three rules for discharging income tax debts in a bankruptcy proceeding based on timing.

The 1st RULE – 3 Year rule

According to this regulation, the most current submission deadline for the tax year should be three years ago. For example – the taxation period in 2018. The 2018 tax return was due April 15th, 2019. As a result, the three-year period from the due date for the tax year in question would be April 16th, 2022 (three years and one day after the original deadline). You must also remember that many “tolling events” might push that due date back.

The 2nd RULE – 2 Year rule

This rule only applies to tax returns that are filed late. If the tax return is submitted on time, the Two Year Rule has always been met.

The rule states that the tax return for such tax year in question must have been filed with the taxation authority (state or federal) at least two years before the chapter 7 bankruptcy was filed.

So, if somehow the 2018 tax return isn’t filed till October 10th, 2021, the bankruptcy case won’t be filed until October 11th, 2023, more than two years after the tax return is filed.

The rule does not consider the tax return’s deadline; instead, it considers the date the return was submitted. So, even if the three-year requirement is met, if the return was late and hadn’t been filed for two years, it won’t be discharged in bankruptcy.

The 3rd RULE – 240 Day rule

The 240 Day Rule states that the taxation authority must assess the tax discharged over 240 days before the actual bankruptcy petition’s filing date. However, the time frame in question in this regulation may be “tolled” or extended. The time limit is extended during the term following the assessment. The taxpayer or his representative should submit an “offer in compromise” for the tax in question, and an extra 30 days should be considered after the offer is refused or approved.

To fulfill the 240 Day Rule, the tax in question should have been assessed for at least 240 days, including any period an offer in compromise was pending. Apart from that, the additional 30 days before the bankruptcy petition’s filing date must also be considered. The 240 days would be tolled for the duration of the automatic stay in a previous bankruptcy filing, plus an extra 90 days.

An IRS Account Transcript will provide the date of assessing the tax in question; however, the date of assessment of a State tax is more challenging to consider and varies by state.

Depending on how much you estimate to repay this year, you may be better off deferring your bankruptcy filing until January 2, 2022.

Modifications to this regulation are permissible in the following circumstances:

  • The time is extended to the next working day if the 240th day falls on a weekend or holiday.
  • The 240-day period can be extended if a compromise offer is under consideration for 96 days or more.

Final takeaway

Only Chapter 7 bankruptcy allows you to get tax debt solutions and discharge your income tax debt through bankruptcy. Consumers can accomplish this by following three timing-based rules.

According to the three-year rule, taxes cannot be discharged unless three years have elapsed after the last tax return was due.

The “two-year rule” states that if a tax return was not submitted on time, it must have been on file for at least two years in favor of being discharged in bankruptcy.

Even if the other two conditions are met, the “240 day rule” prevents taxes imposed within 240 days of the bankruptcy petition from being canceled.

It takes a lot of time and effort to discharge taxes in bankruptcy. So, get professional legal guidance from a bankruptcy attorney if you want expert bankruptcy tax debt help.

How A Bankruptcy Law Firm Helps To Manage Debt In CA State

   

If you are someone struggling with your finances, you are not alone. During the COVID-19 pandemic, a lot of people were under burdensome debt. Whether it was due to job loss or reduction in earnings, filing bankruptcy is an effective way to get out of the situation. For most people, understanding and filing a bankruptcy case can be daunting. 

Although you can file the case without any professional help, the complexity of the process is overwhelming for most people and they end up making horrific mistakes. Mistakes such as losing non-exempt assets, denial of discharge of a debt, or criminal fraud charges! This is where a bankruptcy law firm in San Diego, CA helps you to manage your debts safely and deal with issues such as sues by Bank of America.

Keep in mind that filing a bankruptcy case in California isn’t very different from other states but the important attributes of state law will be mentioned where necessary. Instead of the state courts, the bankruptcy cases are filed in federal district courts. 

What Is A Bankruptcy Firm?

A bankruptcy firm is a firm of attorneys and law experts that specialize in handling bankruptcy cases. Along with the legal advice, these firms are also responsible for handling the complete legal paperwork. In most cases, they assign an attorney to your case that will assist you until the case ends. There are several popular bankruptcy firms such as Cavalry and LVNV funding to help consumers across the USA.

How Does A Bankruptcy Attorney Help To Manage Your Debts?

You can either hire a bankruptcy attorney that works independently or get in touch with a bankruptcy firm. Whatever the case may be, things will boil down to you working with a specialized bankruptcy attorney. Here is how they can help you.

  1. Asses The Complexity Of Your Case

The first step first, understands the complexity of the case. The professional will take a look at all the facts and figures of the recent situation. In some cases, bankruptcy may not be the right way to achieve financial goodwill. The attorney will help you pass through the bankruptcy alternatives. In other cases, the lawyers will help you decide which type of bankruptcy to file depending upon your recent situation. 

The two major bankruptcies for individuals include chapter 7 & chapter 13 that are serving different goals. Chapter 7 bankruptcy, commonly known as direct liquidation, allows you to discharge all of your obligations without having to engage in a payment schedule. When consumers know they cannot pay the debts, they choose to file for chapter 7. 

Chapter 13, often known as a “wage earner’s plan,” entails repaying creditors over a five-year or 60-month period. Whether your list of creditors includes Bank of America, Discover Bank, or TD bank, the attorney will help you make the right decisions at this stage.

Prepare And File The Paperwork

The attorney not only assists you with sound legal advice but helps with the preparation and filing of the case. They better understand how to use any special circumstances you present and apply the means test. The calculation indicates whether you qualify for Chapter 7 or Chapter 13. 

The next important duty is to value your assets realistically. A bankruptcy law firm in California helps the consumers understand and choose between the two separate lists of assets you can exempt. California is one of the few states providing such two lists for its people. The attorney will help you protect assets by using California homestead exemption systems 1 and 2, motor vehicles, household goods, and, wildcard exemption. 

There are a few debts that never leave you. Expect your attorney to tell you about the debts that will survive bankruptcy cases and the ones that won’t.

Once the preparation work is complete, it’s time to fill the length package of forms. Most of the popular established bankruptcy firms or debt buying organizations such as Cavalry SPV use specialized software to complete the required paperwork.

Represent You At All Legal Hearings

Whether you are working with MCM, or Cavalry SPV, a bankruptcy attorney will represent you at all the legal hearings. Bankruptcy attorneys are known for purchasing credit card debt from major banking institutions such as Bank of America and American Express. Starting from the first meeting of the creditors to the final settlement of your case, the attorney represents your case. They also handle the questions with your creditors and prepare you for what a trustee may inquire of you during the meeting.  

Make a Deal With Your Creditors

Your attorney can arrange a reaffirmation agreement or redemption with a secured creditor if you file Chapter 7 bankruptcy. Negotiations that go well may allow you to keep your home or car. In a Chapter 13 bankruptcy case, your attorney will work with you to negotiate payment terms, collateral value and interest rates to keep your repayment plan within your budget for the next few years.

Secure You In Case Of Automatic Stay Violation

Once your attorney has notified the debt collectors about the bankruptcy filing, they must stop making collection calls. If someone is still attempting to call you for debts, this is termed an automatic stay violation. Your bankruptcy law firm can file a motion in the court to hold the creditor in contempt providing you the much-needed peace of mind.

Help Resolves Post Bankruptcy Charges

Professional bankruptcy attorneys are good at making sure everything goes smoothly during the case. But what if something needs attention after the case has ended? Although there are rare chances of that happening, the attorney will handle it for you.

How To Hire A Bankruptcy Firm?

Know that bankruptcy is a highly specialized area of law and you cannot afford to make any mistakes. As you are hunting for the best bankruptcy law firms in San Diego CA, start by contacting your state’s bar association. It would be great if you hire an attorney who is a member of the National Association of Consumer Bankruptcy Attorneys (NACBA) because they better know things. Ask around for the best recommendations before signing any written agreement.

4 Reasons When You Should Hire A Debt Settlement Attorney- Guest Post

   

Speeding Ticket Attorney

It is a common problem for business owners who borrow money for business development. Many times, you will see people are failing to pay their debts, and that is why they are taking risky steps in life. Why do you need to take your life risk when you can get it from a debt settlement attorney?

While you are facing a problem regarding the debts, you must visit a debt attorney. You will get away to go back to normal life. Do you want to know what things are for when you visit a debt settlement attorney?

We are going to tell you today about the situations when you will visit an attorney. You will have different laws in a variety of countries, but there must be some similarities and reasons. Get started with it.

What Is A Debt Settlement Attorney?

Speeding Ticket Attorney

A debt settlement attorney is a specified lawyer that works on the debt settlement. For example, you have taken a lease of a property, and you have suffered economic harm suddenly. At this time, you can go to a debt attorney who will mark you safe from this disaster.

There are debt laws on that they will. If you want to file a case against a person for not paying the debts, you also can do that. Paying debts is important, but if there your git any kind of unusual event, you need to consult with a specialist who is working on this.

For instance, you also can put forward the case in court. However, you decide what you are going to do with your personal case.

Pricing Policy Of A Debt Settlement Attorney

When you are thinking of visiting a debt settlement attorney, you have to know about the charges and the pricing that you have to pay for the attorney. For example, you are having a problem providing the debt, and that is why you are thinking of visiting an attorney. Then you have to find an attorney that will mark you free from the burden of paying debts. So, price is a big factor for everyone. It depends on the cashew and the situation.

If the case is time-consuming, then you may have to pay a bit extra. And in short time cases, the attorneys don’t charge huge amounts of money.

Reasons To Hire A Debt Settlement Attorney

Kansas City Driving While Suspended Lawyer

Before going through the debt settlement attorney, you have to know about the advantages that you will receive from the attorney. That is why we have arranged the reason for that you will visit a debt settlement attorney.

1.     Debt Negotiation

When you are getting up with the debts, you need to know how you can decrease the number of debts that you are paying. Only with the help of a debt settlement attorney can you do this. They have knowledge of the laws, and that is why they can provide you the ways where you will receive a solution.

You will get off the stress with the help of an attorney. The attorney will also charge you for its help. So, be assured and then directly go to your demand to get it fulfilled. Are you ready? It’s not a problem, and you will be less stressed. Give a look at the Finance.

2.     Debt Collection

As a landlord, you must get debts from a person who is not paying the money. At this time, you should contact an attorney that will tell you what to do in this situation. You will get the collection of debts in a few times. If you complain against the person who is not paying the debts, then the higher authority will ask for paying the amount.

This is how you will receive your debts. If the person can’t pay you the debts, then it will give back the property or the thing that it borrowed. It is an effective way that you can do to get the payments you deserve. It happens many times. At this point, you have to go with an attorney who will do half of the work easily. Debt Consolidation is also an important factor that you have to clarify.

3.     Filing the Bankruptcy

You can feel like filing for bankruptcy. In this time also you can go through an attorney that can tell you the ways of paying wages in simple ways. They have hundreds of bankruptcy cases, and that is why they have enough sense in it.

So, don’t wait for the time to come. It is your responsibility to feel free from the headache of wages. Keep on the credit records and then proceed.

4.     Sued To Get Paid

If you stay owed and the person is asking to get paid many times, then also you can make a visit with the debt settlement attorney. Generally, when you are paying up, there must be a time limit up to that you will pay the wages. But if the person demands to get paid the whole amount instantly, then you can take help from the law.

It is tough to pay huge amounts of money at a time. Thus, it is the best time to get away from this problem. A person can’t give stress to pay huge amounts of money at a single time. It is sure that you will get help from the attorney and also from the laws.

The Bottom Lines

These are all the things that you must know about the debt settlement attorney. Get the best things from the debt lawyer. We are sure that you will get out of the problem very soon. However, you must look for the best debt settlement attorney.

You search on google and then find one from the list. But make sure that the amount they will charge from you is affordable for you. If you can’t pay, then they will also not proceed with the case.

Author Bio

Ronald Johnson is a passionate blogger with years of experience in the marketing field. He loves to show his creativity through his writings and inspire people at the same time. Besides, he is also a freelance content writer at The Global Magazine, Global Business Diary, Okey Magazine.

Bankruptcy Discharge: When Should You Expect It?-Guest Post

   

Bankruptcy Discharge

A bankruptcy discharge serves as the final step of bankruptcy in Canada. Once you have signed the bankruptcy papers, you will assign yourself into this state in an automatic manner.

On the day that you file for bankruptcy, an automatic stay is initiated. The automatic stay will prevent your creditors from trying to recoup their money directly from you. The harassing calls and possible threats and intimidation will end. However, your debts will continue to exist until you actually receive your discharge. Due to the long and often arduous process, you may feel apprehensive about filing.

In this article our focus will be on the bankruptcy discharge process and what you should expect so that you will be better prepared before filing.

What is a bankruptcy discharge?

A bankruptcy discharge is a process that involves relinquishing the person involved from the debts that they owed to their creditors when they first filed for bankruptcy. A full discharge is the key benefit of filing for bankruptcy. A person who is insolvent will obtain debt relief under the Bankruptcy and Insolvency Act of Canada. You can provide the required bankruptcy payments to your trustee. You will also be held legally accountable for all debts owed until the bankruptcy process is finalized.

Once you have gone through all of the requirements, your bankruptcy trustee will go over all of the details. Once your licensed insolvency trustee has determined everything to be acceptable, they will file the certificate of discharge on your behalf. You will then be officially absolved of all debts owed.

How long will you be bankrupt?

The majority of bankruptcies are allowed for an automatic discharge after 9 months have passed. However, the duration of your bankruptcy may change according to certain circumstances.

You may be confused by some of the details, depending on your present situation. One thing to note is that you will not be eligible for an automatic discharge after 9 months in the event that you have filed for bankruptcy in the past. Those who are filing for bankruptcy for a second time will need to wait 24 months in order to obtain an automatic discharge.

Your surplus income will also be evaluated. If it is found that your surplus income exceeds the minimum amount that has been set by the Government of Canada, then your bankruptcy proceedings will be drawn out for a prolonged duration.

Another thing to note is that only those who have declared bankruptcy once or twice are eligible for an automatic discharge, although the waiting period will differ depending on various individual conditions and circumstances. While rare, it is possible for your trustee, the Superintendent of Bankruptcy, and one or more of your creditors to oppose your bankruptcy discharge.

Requirements to Obtain a Discharge

In order to be discharged, you must complete all of your bankruptcy duties beforehand. For instance, you will need to make all of your required payments without exception. All assigned property must also be handed over to your licensed insolvency trustee. Withholding of assets, whether intentionally or unintentionally, may carry penalties and other serious consequences.

You will be required to attend two credit counselling sessions. Your attendance is mandatory for these sessions, and you will be taught how to better handle your finances and debts in order to prevent another bankruptcy filing in the future. In some cases, you may be legally obligated to attend a court hearing or examination. You may also be required to attend one or several meetings that involve your creditors.

If you fail to complete any of the aforementioned duties, then your discharge may be held up for months or even years in some extreme cases. Fortunately, the majority of bankruptcies that transpire in Canada end in an automatic discharge. Few require a court hearing in order to reach a verdict.

However, some people will fail to meet all of their legal and financial obligations. Others will commit an offense under the Bankruptcy and Insolvency Act of Canada. If you do not wish to jeopardize the discharge process, then it is best to adhere to all discharge requirements in a timely and orderly fashion.

Debts that Will not be Released After a Bankruptcy Discharge

Most debts will be cleared by a bankruptcy discharge, including, but not limited to, unpaid bills, personal loans, credit card debts, payday loans, and other forms of unsecured debt.

However, there are certain financial obligations and debts that are exempt from discharge under Canadian law. For example, you will still be required to pay back any debts that were generated due to malfeasance (fraud).

As well, penalties and fines that have been imposed by the court must be paid. Spousal support payments (alimony), including for child support, must also be paid as usual, and you must pay back all of your student loans if you have been a student within the last 7 years as well.

There is Hope

Once you receive your discharge, your debts will be removed, which will give you a clean slate, and possibly a new lease on life. However, a record of your bankruptcy will be noted, and will be added to your credit report.

If you have filed for bankruptcy for the first time, then expect your bankruptcy history to be kept on your credit report for roughly seven years. If you file for a second bankruptcy, then your history will likely be kept in your credit dossier for a decade or even longer in some cases.

The final step in a bankruptcy proceeding is the bankruptcy discharge. Many people who obtain their bankruptcy discharge feel relieved afterwards, as the process can drag out for several years in some cases.

However, most people who file feel that the process is worth enduring. Once you have obtained an absolute discharge, you will no longer be legally obligated to pay back your debts. If you are thinking of filing for bankruptcy, then you may want to consider consulting with a bankruptcy debt relief expert beforehand.

What is the benefit of using an attorney in bankruptcy?

   

The Bankruptcy Code has a lot of critical methods, there are different codes applied in which Chapter 7 code is considered to be the best legal tool, and to handle critical situations to clear debts in the hand of creditors you need legal specialists who can help it get settled.

To come in touch with experts, to take smart consultation and ensure your legal tools become more proficient, and to discuss more on your own legal standards to be cleared, it’s better you come in touch with bankruptcy attorney Tucson, discuss your options and they would settle your case in a perfect manner.

In case you are not sure about the bankruptcy code, want to decide which path may be more suitable to clear your financial debts, and want expert advice, then you better consider Chapter 7 bankruptcy lawyers Tucson, discuss your position, and explain your situation and they would settle it legally around.

Before you start to feel that having attorneys may be the best possible solution in concerns to bankruptcy, there are few terms to clear and they may include:

  • Your personal track record to clear finances
  • Understanding to liquidate required finances
  • Your own legal standings covering such legal code
  • Priority of legal terms to satisfy by the help of such expert

And these are few elements that do count for which you need to have a sight on them before considering an attorney for bankruptcy that would settle your course with ease.

To contain your creditors

The first aspect of the bankruptcy code is connected closely with creditors, the way they have to be handled, how they are going to make pressure, and in what way courts look at it does come into effect.

And to contain such creditors, you require expert, smart attorneys who have experience on past trials, who can look after your entire case, and also convince creditors that they do have to ensure their trust in the debt return policy to work in their favor and should settle all financial records in a much better position.

Legal solutions become efficient

Again, to ensure that processes do come in proper ways, to handle experts and also financial personnel’s who are going to build pressure apart from creditors on basis of the amount to liquidate or to be handed in the one-stop process requires experts legal professional who can convince them that such process would go smoothly but would take more time than they consider it to happen in a rapid way.

For that attorney do come into play who can ensure such legal solutions take place in a proper way, who can not only ensure better responses but can provide smart leads, and they are able to convince the opposite faction for which their role in bankruptcy is most valuable to handle all such critical financial situations well.

Lesser direct pressure of debt

Lastly by the presence of legal experts, attorneys who can look into the case, and proper liquidate process accepted by creditors, what it does that direct pressure becomes downhill and the person who has taken debt can take a sigh of relief on the proper functioning of liquidating money in much better structure to settle in the proper course through actual legal terms satisfied in between both parties having much better results too.

Conclusion

For more on the subject of bankruptcy code, to know how things go and what attorneys can actually do to create better results and proper consultancy to solve your financial issues, you can consider bankruptcy attorneys in Tucson who know how it all goes, in what way clients have to be handled including bank personnel’s and creditors, and they will help you prepare a strong case that would help you settle things on course.

All you need to do is take smart advice, channel your energies to compare your debt solution, and try to liquidate such finances in much better standards by proper planning and to handle your legal cases there are experts available such as chapter 7 bankruptcy lawyer Tucson who can handle it well, can settle things and would ensure you to have a much better legal process to fit in your problems so you can settle it on the court and get rightly benefited by such experts available for you.