But Chapter 13 provides a number of other benefits distinct from the discharge of debts. For example, it stops a foreclosure and gives you years to catch up on your mortgage arrears. It also stops extremely aggressive collection of unpaid support payments, including the suspension of professional/occupational/driver’s licenses, again giving you years to bring it current. It may be able to significantly reduce what you pay for your vehicle through a “cram down.” For these and other reasons it can make a lot of sense to file a Chapter 13 case while knowing that you’ll not get a discharge of any of your debts. You may not even have any debts to discharge, but just need one or more of those other powerful benefits.
Source: petersonlawhawaii.com
Video: Short Sales Versus Chapter 7 Bankruptcy: What’s Discharged?
Creditors Seeking Revenge: a Recipe for Expensive Discharge Litigation
Several years ago, for example, I represented a dynamic, well educated business consultant who came to me to file bankruptcy because his former business partner had just won a multi-million dollar judgment against him. It turns out that the dispute between these former partners had been festering for several years and earlier on in the state court litigation, my client had won a large judgment against his partner, and had levied against his former partner’s business banking account causing several checks to bounce.
Source: bankruptcylawnetwork.com
Chapter 7 Bankruptcy Iowa Provides A Fresh Start Submit Editorials
Once you file for bankruptcy, garnishments, judgments and creditor harassment will cease. In some cases, previous judgments can be released or discharged depending on your situation. To do the best job for you, your attorney must know about all outstanding debts, liens against your home, judgments and garnishments, and anything else relevant to your overall financial situation. One of the biggest mistakes an individual can make during the process is to not fully disclose their situation to their attorney. Creditors over the last several years have become more diligent, and often abusive, in their collection tactics. They must cease in contacting you once you have filed for bankruptcy.
Source: submiteditorials.com
Servicers Extinguishing Liens DOES Help Homeowners, They’re NOT Erasing Debt That Isn’t there
Tagged with: bank of america banking lobby bankruptcy discharge dave dayen debt forgiveness taxab;e diana olick economic recovery erasing discharged debt Federal Reserve Chairman Ben Bernanke firedog lake foreclosure crisis foreclosure scams foreclosures FTC MARS Rule Gretchen Morgenson Joseph A. Smith jpmorgan chase loan servicers Making Home Affordable Plan mandelman mandelman matters martin andelman MERS decisions National Mortgage Settlement OCC Independent Foreclosure Review risk of a tax liability TARP trial modifications unemployment
Source: ml-implode.com
Discharging Property Taxes in Chapter 7 Bankruptcy
While the Tenth Circuit opinion in U.S. v. Victor, 121 F.3d 1383 (10th Cir. 1997) held that the tax claim must be unsecured in order to meet the exception in 523(a)(1)(A), the Eleventh Circuit in Gust v. U.S., 197 F.3d 1112 (11th Cir. 1999) (adopting the district court’s opinion in Gust v. U.S., 239 B.R. 630 (S.D. Ga. 1999)) and the Ninth Circuit in Miller v. U.S., 363 F.3d 999 (9th Cir. 2004) criticized this interpretation and held that it is the type of tax, not the type of claim, that determine dischargeability. See also the opinions in Hornick v. IRS, 85 A.F.T.R.2d (RIA) 320 (Bankr. W.D. Pa. 1999) and Barranco v. U.S., 307 B.R. 539 (Bankr. W.D. Va. 2004).
Source: armstrongattorneys.com
Chapter 7 discharge and tax returns: court says no to late return
Tax debt is one debt that is dischargeable through Chapter 7 bankruptcy. However, for one individual in Mississippi, hers was not considered in the total. Why? The court ruled that federal law prohibited a late-filed state tax return from being considered. In fact, the court ruled that it would not consider it a “return” at all under the Bankruptcy Code. The effect of this ruling was that the debt was rendered non-dischargeable.
Source: tampabankruptcylaws.com
You cannot discharge a federal tax lien in a Chapter 7
I have discussed in prior blogs discharging tax liens in Chapter 13. How about Chapter 7 and tax liens? The quick answer is that you cannot discharge federal tax liens in Chapter 7 bankruptcy. While there are some income taxes that can be discharged in Chapter 7 (please see prior blogs to see the requirements to discharge taxes), if the underlying tax debt becomes a lien prior to filing a Chapter 7, you cannot discharge or eliminate the tax lien. This means you will need to make arrangements with the IRS to pay the tax lien.
Source: danielstonelaw.com
Help! I Just Got a “Final Notice of Intent to Levy” from the IRS! :: Schoenbohm Law S.C.
10. Even if you only have tax debts that would otherwise be discharged in Chapter 7, but you need to file Chapter 13 to deal with other debts that are important to you—such as on your home and vehicle and support arrearage—these other obligations can legitimately reduce how much you pay on your tax debts. Sometimes you pay nothing on the taxes. So Chapter 13 can be the best of all worlds: protection from all your creditors including the IRS while you take care of other debts, along with paying little or nothing on your tax debts.
Source: schoenbohmlaw.com
How to Discharge Debt through a Chapter 7 Bankruptcy
Although a debt discharge provides tremendous benefit and relief, there is a complex legal process involved. Discharging debt is not as simple as filling out a few forms. If you wish to discharge debt and file a bankruptcy petition, several events are triggered: a bankruptcy case is opened; a case number, judge and trustee are assigned; a slew of requirements must be met; and potential consequences must be thoroughly evaluated. Non-compliance with all requirements or improperly evaluating the effect of filing may prevent a successful discharge of debt. Because of the complexity involved, it’s always wise to speak with an experienced bankruptcy attorney before embarking on this journey to ensure you have the best chance of a successful discharge of debt.
Source: royzmanlawfirm.com
Chapter 7 Bankruptcy Means Test Explained
If you have disposable monthly income according to Test 2, then you move to Test 3. Test 3 rarely applies; but basically, if your monthly disposable income multiplied by 60 is less than $6,575, then you are presumably a chapter 7 bankruptcy. If your disposable monthly income multiplied by 60 is between $6,575 and $10,950 and that amount will not pay at least 25% of your non-priority unsecured debt, then you presumably qualify for chapter 7 bankruptcy. In essence, within those narrow guidelines, the bankruptcy code is saying that there is not enough left over at the end of the month to matter.
Source: mpslawoffices.com
How soon after Chapter 7 bankruptcy can you buy a new house?
Why is this? The truth is that someone who files bankruptcy is usually much less of a credit risk after filing bankruptcy than they were before having done so. Prior to filing bankruptcy, the individual had multiple creditors. A new lender that made a loan to the individual would have to compete with other creditors in order to be paid. The new lender would also need to be concerned with a bankruptcy being filed in the near future thereby discharging all of the debt owed. Following bankruptcy, the individual is often debt free. Therefore, the new lender will not have to compete with other creditors in order to be paid. Further, if the individual filed a chapter 7 bankruptcy, she will not be able to so again for another eight (8) years. Thus the new lender will have little worry about his debt being discharged in a future bankruptcy.
Source: bondnbotes.com
Business Chapter 7: Dissolution v. Discharge
After the assets are sold, there’s still some remaining debt, of course. However, these debts are not discharged. In personal Chapter 7 cases, debts are discharged. But, in business Chapter 7, those debts still remain in theory. Instead of discharging the debts, the court orders that the business entity (whether a corporation, partnership, or some other form) be dissolved.
Source: leebankruptcy.com
Bankruptcy: Can My Chapter 7 Discharge Be Revoked? #1: << Bankruptcy licb articles
Bankruptcy: Can My Chapter 7 Discharge Be Revoked? By Ronald Drescher Most debtors believe that once they receive a discharge in bankruptcy and their case is closed they can put their troubles behind them. While that’s true almost all the time the bankruptcy code does leave the door open for creditors to complain that the discharge was obtained as a result of fraud. Like many other provisions of the bankruptcy code the timeframe for bringing these actions is somewhat compressed. The procedure for debtors obtaining a discharge in bankruptcy is fairly straightforward. At the beginning of the bankruptcy case the debtor submits schedules of assets and liabilities and a statement of financial affairs. These documents attempt to accurately and completely portray the debtor’s financial condition. The debtor signs these documents under penalty of perjury and they become open to the public. Approximately 30 to 40 days after filing a case the debtor meets with a Chapter 7 trustee. (Although this meeting is technically called the “first meeting of creditors” creditors almost never attend.) Creditors and the trustee then have 60 days after the first meeting of creditors to complain to the bankruptcy court that the debtor should not receive a discharge or that individual claims should not be discharged and should survive the bankruptcy case. This 60 day period is strictly enforced and if no complaints are filed during that time the bankruptcy court will promptly award the debtor a discharge. Almost every chapter 7 case results in the debtor receiving a discharge. At the same time, almost every chapter 7 case is a “no asset case” where the trustee does not identify any assets to be liquidated to cash for distribution to creditors. If the case is a “no asset” case, the bankruptcy will be closed promptly after the debtor receives a discharge. However, this is not always the end of the story. Within one year after entry of the discharge the trustee, a creditor, or the United States trustee may request a revocation of that discharge “if it was obtained through the fraud of the debtor, and the requesting party did not know of the fraud until after the granting of such discharge.” In those situations, the objecting creditor will likely need to ask the bankruptcy court to reopen the case and at the same time file a motion to revoke the debtor’s discharge. Other grounds to cause the revocation of the debtor’s discharge also address the debtor who is dishonest or refuses to cooperate in the bankruptcy process. For example, a debtor may obtain property by inheritance within 180 days after filing a bankruptcy case. When that happens, the debtor is supposed to report that inheritance to the Chapter 7 trustee, even if the bankruptcy case has been closed. If the debtor “knowingly and fraudulently” fails to report this inheritance then the trustee or other creditor may file a motion to revoke the discharge. The timeframe for bringing this action is one year after the later of closing the case or entry of the discharge order. If the trustee identifies assets for distribution then the debtor’s exposure to a discharge revocation could be considerably longer then one year after the discharge: trustees frequently keep a Chapter 7 case open for several years as they identify assets for liquidation and distribution to creditors. This longer timeframe also applies if the grounds for the motion to revoke the discharge are that a debtor has refused to obey an lawful order of the court or to respond to a material question approved by the court or otherwise to testify as to a material fact in the bankruptcy case. Finally, grounds to revoke a debtor’s discharge may arise when a debtor fails to cooperate during an audit conducted by the United States trustee. Although these audits are rare, the United States trustee does have the right to conduct audits of debtors, their assets, debts, income and expenses. These audits serve the function of policing the “honor system” that is at the heart of the bankruptcy disclosure process. Specifically, the bankruptcy code provides the United States trustee with the right to ask for revocation of discharge if the debtor “fails to explain satisfactorily a material misstatement” or “make available for inspection all necessary accounts, papers, documents, financial records, file and all other papers, things, or property belonging to the debtor that are requested for an audit.” The bankruptcy code is silent as to the timeframe for the United States trustee to ask a bankruptcy court to revoke the debtor’s discharge upon the debtor’s misbehavior during an audit. While the United States trustee should not have an unlimited amount of time to bring this action a debtor should expect that a bankruptcy court will grant the United States trustee longer than the one year after discharge imposed upon other creditors. Creditors almost never file motions to revoke a debtor’s discharge. Nevertheless, the threat exists that a dishonest debtor may have his ill-gotten fresh start taken away. This “escape hatch” for creditors is an important component to preserve the integrity of the bankruptcy system. Ronald J. Drescher is an attorney practicing bankruptcy and creditor’s rights in Maryland, Delaware, Virginia, and Pennsylvania Please visit our website:
Source: blogspot.com