Recent Blog Posts
Is Chapter 13 Bankruptcy a Good Idea?
If you want to take control of your own financial situation and protect your assets from creditor seizure, then yes, Chapter 13 bankruptcy (a/k/a the wage earner plan) is a good idea. Chapter 13 is also a good idea if you want the benefits of bankruptcy but don’t want some of the drawbacks, such… Read More »
Why Do People File Bankruptcy?
Quite simply, people file bankruptcy because they owe more money than they can pay. Such financial problems can happen to anyone. Following the 2008 financial crisis, five huge companies which collectively had over $1 trillion in assets filed bankruptcy. Their own misconduct contributed to these filings, but the economic downturn substantially caused them. Likewise,… Read More »
What is the Average Consumer Debt Per Person?
Since 2020, the average consumer debt per household has increased to over $100,000. Even a slight increase tremendously impacts families who live hand to mouth. Even more troubling, in 2021, prices increased faster than wages. When that happens, something’s gotta give. That “something” is usually credit card payments and, in many cases, home mortgage… Read More »
Bankruptcy and Past-Due State Taxes
Mostly because of its recent and well-chronicled budget problems, the Prairie State has one of the highest state income tax burdens in the country. Most of that burden falls on self-employed people. When their incomes drop, they often suspend estimated tax payments. That suspension comes back to haunt them in the spring, when they… Read More »
Is It Better to File Chapter 7 or 13?
The answer to this question normally depends on the type of debt. If you have an issue with unsecured debt, it’s better to file Chapter 7. Many people are in this boat. The average credit card holder owes about $4,000. If you have an issue with secured debt, it’s better to file Chapter 13…. Read More »
Special Issues in an Over-55 Chapter 7 Bankruptcy
The overall consumer bankruptcy filing rate has declined significantly since 2005, when the law changed dramatically. But the over-55 bankruptcy filing rate has increased over 60 percent over roughly that same period. The combination of several recessions, or mini-recessions, a shrinking social safety net, and a few other factors have prompted many people in… Read More »
Is It Hard to Get Chapter 7?
We wouldn’t say it’s “hard,” but we would say it’s “harder” now than it was twenty years ago. In 2005, Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). Creditor lobbyists convinced many lawmakers that Chapter 7 filing abuse was serious and widespread. The evidence clearly shows that circumstances beyond the debtor’s… Read More »
Is an EIDL Loan Discharged in Bankruptcy?
During and after the COVID-19 pandemic, the Small Business Administration loaned over $600 billion to small businesses. This money mostly included PPPs (paycheck protection program) loans and EIDLs (economic injury disaster loan). These financial lifelines allowed many businesses to stay afloat during the lockdowns. But as the lockdowns dragged on, and after a labor… Read More »
Will the IRS Accept My Offer in Compromise?
The gig economy has grown significantly since 2018. Today, over seventy-three million Americans freelance full or part time. Freelance income is feast or famine. Two or three months of lucrative earnings might be followed by two or three months of basically zero income. These fluctuations often make consistent estimated tax payments impossible. Furthermore, during… Read More »
Top Five Property Exemptions in Illinois
Many states have limited bankruptcy property exemptions. In these states, since the trustee (person who oversees a bankruptcy for a judge) has broad powers to liquidate assets, debtors must think twice before they file bankruptcy. Illinois is different. The Prairie State has extremely broad property exemptions. In fact, for most purposes, most Chicagoland residents… Read More »
