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Taxes were due prior to filing. They are discharged right?The answer is, it depends. Taxes and their dischargeability depend on the type of taxes, what tax year they are form, when they were filed, when they were assessed and whether they are now secured by any real estate.We will discuss the most typical type of taxes that Debtors want to discharge. That is state and/or federal income taxes. In order to taxes to be discharged they must meet the following criteria:
- Taxes must be for a year that is atleast 3 taxes years ago from prior the date the bankruptcy is filed; AND
- Example: The bankruptcy is filed on August 1 2013. The 3 tax years that were due at the time of filing are 2012, 2011 and 2010. This means that any debt owed for those years is not discharged. However, Tax years 2009 and prior can be discharged through the bankruptcy IF it meets the remaining criteria detailed below.
- Taxes must have actually been filed atleast 2 taxes years ago from prior the date the bankruptcy is filed; AND
- Example: The bankruptcy is again filed on August 1, 2013. The taxes that are owed are for 2008 meaning that they pass the test above in that they were filed more than 3 tax years ago as of the date the bankruptcy was filed. So now we look to when the taxes were actually filed. In our example we will say the taxes were actually filed on July 10, 2011. Given that July 10, 2011 is more than 2 years prior to the date the case was filed, the taxes are eligible to be discharged through bankruptcy IF it meets the remaining criteria detailed below.
- Taxes must have actually been filed atleast 180 days ago from prior the date the bankruptcy is filed; AND
- Example: Example: The bankruptcy is again filed on August 1, 2013. The taxes were for tax year 2008, they were actually filed July 10, 2011 and were assessed December 15, 2011. Given that they meet the criteria above and they were assessed more than 180 days prior to the date the bankruptcy was filed, the taxes are eligible to be discharged through bankruptcy IF it meets the remaining criteria detailed below.
- There must not already be a lien placed on your property, real estate or otherwise.
- Even if the taxes meet all the criteria above, if there is a lien against your real estate the debt cannot be discharged through a bankruptcy.
My car got repossessed. There is nothing I can do to get is back right?Wrong, depending on when you take action. You an often contact your creditor, make the payment to become current and they will return the vehicle. However, you probably do not have the money to become current or you would have paid it before it was repossessed. So now what?You can file a Chapter 13 bankruptcy, again depending on when you take action. If you contact our office prior to the car being repossessed we may be able to prevent repossession which will save you on repossession and storage fees. However, even if it has already been repossessed, the creditor must wait at least 10 days before they can sell the vehicle. So long as we file the Chapter 13 bankruptcy before the vehicle is sold, the creditor must return it to you given that you comply with certain requirements.In order to file the Chapter 13 bankruptcy we need:
- Most recently filed state and federal taxes
- 6 months of income history
- Credit counseling certificate
- Documentation of the creditor who did or is about to repossess the vehicle
- A completed questionnaire that we will provide to you (While it is ideal to have this completed prior to filing, depending on the time crunch, this can be completed the day after the bankruptcy is filed)
- Attorney’s fees and court costs (Fees should be discussed with the attorney as they vary by office and circumstance
Okay so the bankruptcy is filed. You are done and they have to give you the car back right? Not necessarily.Prior to returning the vehicle to you the creditor CAN, but does not always require:
- Storage/Repo fees to be paid. Occasionally the creditor will agree to roll these fees into the loan. While you are still eventually going to pay for it, it helps with not having to come up with the money immediately in order to have the vehicle returned.
- The creditor can request proof of insurance. Seems simple enough since you should have insurance on the vehicle anyways. However, rules allow the creditor to require proof of 3 months prepaid insurance with a minimum liability amount. This can pose a problem depending on how you pay for insurance. If you pay monthly you likely will have to come up with additional funds to prepay the 3 months.
By Mary Ann Pekara
The city of Detroit, Michigan filed for Chapter 9 bankruptcy protection in July and is now waiting until late October for a trial.
While there has been much controversy over the situation in Detroit, one thing is for certain, the people of Detroit have a lot to say about it.
On Thursday, taxpayers were front and center in the courtroom instead of the attorneys. Residents and retirees were given the opportunity to express their feelings on the Detroit bankruptcy situation to a judge, for 3 minutes each.
Judge Steven Rhodes listened to many residents who expressed strong concern about what would happen to their pensions in the city's bankruptcy.
Residents spoke to their reliance on pensions and the dedication they gave to the city for so many years, "promises made, promises broken."
FriendFinder Networks, owner of adult entertainment website and the popular magazine publication Penthouse, has filed for Chapter 11 bankruptcy. The company has been struggling to pull in new revenue in recent years, while having problems paying back outstanding loans and other debts. In August, the company was delisted from NASDAQ when their stock trade fell [...]
Bringing you the most up-to-date news, tips and blogs throughout the web. Here’s your Bankruptcy Update for September 19, 2013 Detroit Residents to Voice Pension Fears to Bankruptcy Judge Rapper Young Buck Fresh Out Of Bankruptcy Devonshire PGA Files Bankruptcy With Restructuring Plan
Some debtors may get confused about the aspect of listing all debts when you file your petition. You are required by the bankruptcy court to submit all details in relation to outstanding debts, including creditors that are owed and their outstanding balances. But, what happens when more than one collection agency gets a hold of [...]
In our previous post we discussed the bankruptcy petition, the Schedule A listing of real estate/property and the Schedule B listing of personal property. In this post we will discuss property exemptions (Schedule C). Under federal and state bankruptcy laws, there are categories and amounts of property that are exempt from the bankruptcy process. […]The post Bankruptcy Filing – Property Exemptions and Schedule C appeared first on Tucson Bankruptcy Attorneys Trezza & Associates.
A recent revision to Oregon’s mediation requirements has set off an anvalanche of requests for face-to-face meetings between lenders and borrowers with delinquent mortgages. This recent amendment to the Oregon Legislature’s Foreclosure Avoidance Mediation Program requires all lenders to meet with distressed homeowners before foreclosing on delinquent mortgages. This change has recently resulted in 500 new requests for mediation.
Over the last two years and for a variety of reasons, more and more lenders had been opting for judicial foreclosure in Oregon. Until recently, lenders who commenced judicial foreclosures were able to avoid mediation, but that exemption has now been removed. Here’s hoping that the initial spike in mediation requests will continue and that getting lenders and borrowers together at the same table will help ward off foreclosures and keep Oregonians in their homes.
The original post is titled Change in Oregon Mediation Law Aids Consumers in Foreclosure , and it came from Oregon Bankruptcy Lawyer | Portland, Salem, and Vancouver, Wa .
Tony Sutton, 46, former chairman of the Minnesota GOP has filed for Chapter 7 bankruptcy protection. Along with his wife Bridget, the couple claims to have outstanding liabilities totaling over $2 million. During his political career as state Republican Party chairman, Sutton pushed aggressively for republican legislators to stay in line with spending based on [...]
Sometimes what begins as a Chapter 13 bankruptcy ends up as a Chapter 7. Here are some reasons why.
You go into bankruptcy with a clear sense of what you want to accomplish. Whether it’s to handle a mortgage problem, taxes, or simply because you’ve got the ability to repay some of your debts, Chapter 13 can be a big win.
See also:
But 36-60 months is a long time, and fortunes change.
Here are some of the reasons why your Chapter 13 bankruptcy may be better off as a Chapter 7 bankruptcy.
Convert To Chapter 7 If You Can’t Make The Chapter 13 Payments
When you file for Chapter 13 bankruptcy, you put together a Plan for the repayment of some or all of your debts over a 36-60 month period.
If your income goes down or your other expenses rise, you may not be able to make those payments. Rather than having the Chapter 13 trustee dismiss your case, consider whether converting to a Chapter 7 is a good idea.
See also:
Convert If The Arrears Keep Building
If you filed your Chapter 13 bankruptcy case to catch up on car or mortgage payments, you know you’re responsible for making all new payments on time.
Failure to make those post-petition payments on time will cause the lender to ask the court for permission to foreclose or repossess the car.
This would make a Chapter 13 bankruptcy less useful. If you’re going to lose the house or car anyway, consider converting to Chapter 7. This will allow you to wipe out any shortage or deficiency that might otherwise arise.
Convert If You Want It Finished
Chapter 13 bankruptcy takes up 3-5 years of your life, during which it’s difficult to take on new debt or build up your savings for the future.
If you want to just get on with your life and are willing to give up any non-exempt assets, conversion may not be a bad idea.
See also:
- Options For Keeping Your Home Or Car After Chapter 7 Bankruptcy
- California Homestead Exemption
- California Bankruptcy Exemptions
- New York Homestead Exemption
Understand The Power Of Conversion
Your rights and responsibilities differ significantly under Chapter 7 as opposed to under Chapter 13. By weighing the pros and cons, you’ll understand which remedy gives you a better deal.
Conversion isn’t for everyone, nor it is appropriate in all situations. But for the right person at the right time, converting your Chapter 13 to Chapter 7 can be a powerful way to achieve your financial goals in bankruptcy.
3 Powerful Reasons To Convert Your Chapter 13 Bankruptcy Case To Chapter 7 was originally published on Consumer Help Central. If you're seeing this message on another site, it has been stolen and is being used without permission. That's illegal, a violation of copyright, and just plain awful.
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