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Bankruptcy can help you eliminate back income taxes depending on your situation and qualifications. You can file Chapter 7 bankruptcy to discharge tax debt that qualifies under the bankruptcy code. If your debt does not meet these qualifications, you may consider Chapter 13 bankruptcy to help you repay what you owe based on your income […]
If you lost your Oregon home in a foreclosure or gave it up in a short sale prior to 2014, there were no tax repercussions to the forgiveness of debt. Unfortunately, the exception in the tax laws that made this so has now expired.
If you lost your principal residence in a foreclosure or gave it up in a short sale in 2014, you may still need to pay taxes on the forgiven debt. Until cooler heads prevail and the exception in the tax laws is reenacted, there are still two ways to avoid going out of pocket to the tax man. These exceptions can be applied not only to debts forgiven in a short sale or foreclosure but to debts eliminated in a debt settlement arrangement.
1. Insolvency: Forgiven debt is not counted as income if your remaining debts are greater than the value of your assets when the forgiveness occurs. So take away the mortgage that was foreclosed and total up the value of your assets and determine if the total value of those assets is less than what you still owe. Chances are if you are on this website, the answer is that your stuff is worth considerably less than what you owe on your other debts. The only real wrinkle is that the value of your 401k will be counted in the asset total.r.
2. Bankruptcy Discharge: Debt discharged in bankruptcy cannot create tax liability if the sale takes place later. Your personal liability is extinguished by the bankruptcy so there is no debt forgiveness in the later foreclosure or short sale.
If you have any questions at all regarding foreclosure, debt forgiveness, insolvency or bankruptcy, please feel free to contact either our Portland or Salem Bankruptcy Law Offices for a free consultation.
The original post is titled Mortgage and Debt Forgiveness in Oregon and the IRS , and it came from Oregon Bankruptcy Lawyer | Portland, Salem, and Vancouver, Wa .
A Mortgage Company Rep Buys Me Lunch Every week I assure five or six nervous couples that, yes, it is possible to buy a house and get a mortgage after filing bankruptcy. Current government regs say you can qualify for a mortgage and buy a house two years after a chapter 7 discharge. (It’s three […]The post Can I get a mortgage after filing bankruptcy? appeared first on Robert Weed.
Should I Declare Bankruptcy? wants to file for bankruptcy. I guarantee that no one wished upon a star as a young person and thought to themselves “I want to be a real estate mogul and a famous singer and…bankrupt!” That has NEVER happened. However, even real estate moguls and famous singers have ended up bankrupt. […]The post How Do I Know If I Should File Bankruptcy? appeared first on Tucson Bankruptcy Attorney.
The filing of a chapter 13 bankruptcy case puts a stop to most creditor actions, including most foreclosure cases. Under chapter 13, a property owner is given the opportunity to reorganize his affairs while under the protection of the Bankruptcy Court.
The following three main features available under chapter 13 are described below.
1. Mortgage modification
2. Chapter 13 Plan to reinstate mortgage
3. Avoiding of junior mortgages
Mortgage Modification - Mediation
Within the chapter 13 case, a property owners may make use of the Bankruptcy Court's new "Loss Mitigation Mediation" (LMM).
This program is innovative in certain respects. Under this program, a Bankruptcy Court appoints a meditor to help the parties reach an agreement to modify the mortgage. A mediator is able to help the homeowner and mortgage company communicate and reach an agreement for modification.
This program also involves the use of an internet "portal" which allows the homeowner to upload all the documents needed for the mortgage company to consider for a modification. Through this portal the homeowner and mortgage company are also able to communicate.
Reinstate Mortgage
If a homeowner does not want to modify his mortgage, he may propose a chapter 13 plan to provide for the reinstatement of his mortgage by catching up the mortgage arrearage over a period of 3 to 5 years, while maintaining current payments.
Avoiding of Under Water Mortgages and Association Liens
If a second mortgage is "under water," the involved lien may be avoidable. To be avoidable as to residential property, there must not be any equity in the property to support the mortgage lien. That is, more is owed on the first mortgage than the value of the property. Association liens, including condominium association liens, may also be avoidable in whole or in part, to the extent that they are "under water."
(305) 891-4055 - Jordan E. Bublick is a Miami Bankruptcy Lawyer with over 25 years of experience in filing Chapter 13 and Chapter 7 Bankrkuptcy Cases.
Bringing you the most up-to-date news, tips and blogs throughout the web. Here’s your Bankruptcy Update for March 6th, 2014 Man Who Avoided Child Support By Faking Bankruptcy Gets 17 Years Over 1,500 stockbrokers fail to report bankruptcy, criminal records Mt. Gox’s Bankruptcy Case Will Be Unlike Any Other
In late January a federal grand jury returned a two-count indictment with charges against 63-year old Eduardo Galan of Brockport, New York, which included mail fraud and bankruptcy fraud. He is facing a maximum prison sentence of 20 years, a $250,000 fine or both. Galan’s charges stem from stealing thousands that was meant for business […]
It is a central tenet of bankruptcy law that “the honest but unfortunate debtor has a right to a ‘fresh start.’” This fundamental principle does not, however, apply to the debtor who cannot pay his or her student loans. Rather, the bankruptcy code provides that unless excepting such extreme circumstances, a debtor is not entitled to a discharge of his or her student-loan debt.
Currently there is an overwhelming amount of student loan debt – over $1.1 trillion in the United States! Many people file for bankruptcy, eliminate all of their credit card debt, medical bills and the like but still emerge from bankruptcy with tens of thousands of dollars in student loan debt. So the question of many of my clients is what, if anything, can be done to help with the student loans.
As with most legal questions the answer depends on several factors. The first that needs to determined is whether your loans are federal or private. Federal loans have several programs that can reduce your monthly payment or even eliminate the loan. Most do not do not involve filing bankruptcy. Here are several options:
- Disability: Borrowers may be eligible to have their federal student loan debt discharged because of a total and permanent disability.
- Loan Rehabilitation: Federal regulations allow borrowers who default on repayment of their loan a one-time opportunity to bring their loans out of a default status and repair the negative credit information reported to credit bureaus. Payment amounts are set at a reasonable rate and borrowers must make nine consecutive on-time payments over a 10-month period. Completing rehabilitation restores a borrower’s loans to good standing and helps to repair credit. Entering a loan rehabilitation agreement has immediate effect on a borrower’s defaulted loans: it stops all collections activity and legal proceedings, prevents wage garnishment, and it may protect a borrower’s state and federal tax refunds from IRS offsets.
- Closed School Discharge: Borrowers whose school closed before they could complete the program of study may be eligible for discharge.
- Bad School: A borrower’s student loans can be discharged if a school falsely certified the student’s eligibility for a federal student loan on the basis of ability to benefit from the education, signed the borrower’s name without authorization by the borrower
- Death Discharge: If an individual borrower dies, or the student for whom a parent received a PLUS loan dies, the obligation of the borrower and any endorser to make any further payments on the loan is discharged.
- Teacher Loan Forgiveness Program: Teachers in low-income areas and those who teach math or science are eligible for forgiveness of up to $17,500.
- Public Service Loan Forgiveness: Borrowers who make 120 qualifying payments under the IBR, ICR, or 10-year fixed payment schedule while employed in the public sector are eligible to have any balance remaining on their student loan debt forgiven. Public service includes employment with most local, state, federal, tribunal nation, or § 501(c)(3) corporations. (Direct Loan Program loans only).
- September 11 Survivors Discharge: Survivors of or eligible victims of the September 11 attacks may request discharge of their student loan debt. (Direct Loan Program loans only).
Unfortunately, there are far fewer options when it comes to dealing with private student loans.
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The state of Texas, along with a few other states, may not allow creditors to garnish wages to satisfy debts, except for special circumstances such as spousal/child support, student loans and federal taxes. A wage garnishment is when a creditor receives permission from the court to withhold payment from paycheck earnings and have them forwarded […]
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