Recent Blog Posts

How Does Bankruptcy Stop Vehicle Repossession?
The repossession threat is real. Legally, banks or other lenders can begin the repossession process after only one missed payment. Usually, these companies electronically disable vehicle ignition even earlier than that. There’s more bad news. Since pandemic lockdowns ended, a combination of high gas prices, job cuts, high vehicle prices, and overall high inflation… Read More »

Can You File Bankruptcy on IRS Debt?
You bet. In most cases, bankruptcy discharges IRS tax debt, gives taxpayers more time to pay, or both. Back taxes are a big issue for many of the nation’s seventy-five million freelancers. Many parts of the country, especially large urban areas like Chicago, didn’t fully get back to normal until sometime in 2022. So,… Read More »

Should I File Chapter 7 or Chapter 13?
Filing choice usually depends on the type of debt. People with burdensome unsecured debts, like medical bills and credit cards, usually file Chapter 7. Debtors who are behind on mortgage notes and other secured debts generally file Chapter 13. Procedurally, the two major forms of consumer bankruptcy are almost identical, except for the length… Read More »

Can Student Loans Usually be Discharged in Bankruptcy?
For many years, the answer to this question was a depressing “usually no.” Now, the answer to this question is an encouraging “it’s complicated.” As his outright student loan forgiveness plan faltered, Joe Biden ordered the Department of Education to release new guidelines regarding bankruptcy and student loans. These discharge guidelines, which are examined… Read More »

Bankruptcy Filing Rates Soar
High interest rates and inflation are starting to take their toll, as Chapter 13 bankruptcy filings increased 23 percent in the first half of 2023. “The growth in filings is reflective of more families and businesses facing surging debt loads due to rising interest rates, inflation, and increased borrowing costs,” American Bankruptcy Institute’s executive… Read More »

Special Issues in Gray Bankruptcies
Adverse economic conditions have combined to drive up over-55 bankruptcy filings 65 percent since 1991. Many people in this age group financially support their children, at least partially. Furthermore, once-generous government and charitable social welfare programs aren’t nearly as generous anymore. The icing on this unpleasant cake is persistently-high inflation and interest rates. All… Read More »

What is Chapter 7 in a Bankruptcy?
This federal debt relief program is not a white flag of surrender. Instead, Chapter 7 in a bankruptcy is a fresh start. Many Americans, especially those with high credit card debt, badly need a financial fresh start. Revolving debt is a treadmill. Since the interest rate is so high, usually above 20 percent, no… Read More »

Formal and Informal Property Exemptions in an Illinois Bankruptcy
The Bankruptcy Code guarantees debtors a fresh start. This fresh start wouldn’t be possible unless the debtor’s assets were exempt (protected) from creditor or trustee seizure. Creditors might try to repossess property if the debtor is delinquent. Trustees (people who oversee bankruptcies for judges) seize property, liquidate it, and distribute the money among creditors…. Read More »

What Happens When You File Chapter 13 Bankruptcy?
The short answer to this question is easy. When you file Chapter 13, or any other form of bankruptcy, you get a fresh start, as the Supreme Court confirmed once again in 2023. But the legal bankruptcy process goes far beyond filing paperwork. If the case isn’t filed properly, or is filed at the… Read More »

Can You File Bankruptcy on IRS and State Taxes?
Many Illini are behind on their taxes, mostly because the era of the pure 9-to-5 job is gone. In the United States alone, freelancers now earn more than $1.3 trillion per year. Since this income is uneven, it’s easy to fall behind on estimated tax and other such payments. Taxing authorities, especially in cash-strapped… Read More »