Recent Blog Posts
What is the Innocent Spouse Rule with the IRS?
Fifty years ago, when most women were economically dependent on their husbands and less well-educated than them as well, the IRS innocent spouse rule was almost a magic wand that made tax problems disappear, if the claimant met certain qualifications. Those qualifications are much the same today. However, since the economic and educational climate… Read More »
Is Debt Negotiation a Good Idea?
In some cases, debt negotiation is a good idea because it’s a reasonably effective bankruptcy substitute. Some debtors have severe bankruptcy-phobia. They refuse to even consider the prospect of a Chapter 7 or Chapter 13 voluntary petition regardless of their situation, much like some people won’t undergo heart surgery even if they need the… Read More »
How Unwritten Bankruptcy Exemptions Help You
Illinois’ formal, written bankruptcies, which include a large wildcard exemption that could apply to almost any property, are some of the most generous exemptions in the country. Typically, these exemptions are more than enough to protect houses, cars, and other key property, so debtors get the fresh start the Bankruptcy Code guarantees. But almost… Read More »
What Are the Qualifications for Chapter 13 Bankruptcy?
Overall, the qualifications for Chapter 13 bankruptcy are that the debtor must be honest and unfortunate. Honest debtors truthfully and accurately complete paperwork, cooperate with the trustee (the person who manages a bankruptcy for a judge), and fully respect the authority of the bankruptcy judge. Unfortunate debtors file bankruptcy due to financial problems which… Read More »
Can I File Bankruptcy on Back Taxes?
Yes, bankruptcy takes care of back taxes. In fact, in many cases, back taxes are dischargeable in bankruptcy. Since back taxes are priority unsecured debts, like student loans and most employee wage claims, certain additional eligibility requirements apply. We’ll examine these requirements for discharge below. The modern, slimmed-down IRS often doesn’t start aggressive collection… Read More »
Which is Better: Chapter 7 or Chapter 13?
Debtors with excessive unsecured debts, like credit cards, usually file Chapter 7. Debtors with unpaid secured debts, like past due mortgage payments, usually file Chapter 13. Though they go about it in different ways, both these kinds of consumer bankruptcy accomplish the same goal , which is giving honest yet unfortunate debtors a fresh… Read More »
Is Bankruptcy Really a Fresh Start?
Congress enacted the Bankruptcy Code for just this purpose. This legal debt relief program eliminates burdensome unsecured debts, like credit card bills, and gives debtors a chance to catch up on past-due secured debt payments, like home mortgage payments. However, bankruptcy isn’t a magic wand that reverses financial fortunes. Unless debtors have an exit… Read More »
Why Do People File Bankruptcy?
Quite simply, people file bankruptcy because they owe more money than they can pay, and they need a fresh start. This fresh start is available to honest yet unfortunate debtors. Honest debtors complete paperwork accurately, are forthcoming about all their debts and assets, fully cooperate with trustees (people who supervise bankruptcies for judges), and… Read More »
What is the Best Bankruptcy for Seniors?
As outlined below, the best bankruptcy for seniors usually depends on the type of debt the senior has. Before the mid 1990s, almost no one asked this question, because almost no senior adults filed bankruptcy. However, the filing rate for the over-55 demographic has increased over 60 percent since 1991, even as the overall… Read More »
What Happens with Chapter 7 Bankruptcy?
Chapter 7 bankruptcy, which is also known as a liquidation bankruptcy, discharges most unsecured debts, such as medical bills and credit cards. According to the Bankruptcy Code, a discharge “releases the debtor from personal liability for certain specified types of debts.” In plain English, discharge eliminates the legal obligation to pay a debt, but… Read More »