Category Archives: Bankruptcy
IRS Fresh Start Program Vs. Bankruptcy: Which Is Better?
In 2011, just as the country was emerging from the Great Recession, the IRS rolled out the Fresh Start Program “to help struggling taxpayers.” Let’s stop right there. The IRS didn’t create this initiative to help taxpayers. The IRS began it to help the IRS. Year after year of staff cuts and budget cuts… Read More »
What Happens When People Over 60 File Bankruptcy?
We get this question a lot, mostly because the over-60 filing rate has tripled since the 1980s, while the overall bankruptcy filing rate has declined. Once again overall, people of all ages, genders, ethnicities, and citizenship status can file bankruptcy, provided they have a Social Security number and otherwise qualify. Everyone has the same… Read More »
Reducing Debt Without Filing Bankruptcy
Irrational fear of filing bankruptcy, or bankruptcy-phobia, is every bit as real as agoraphobia, claustrophobia, and any other -phobia. Sometimes, the best approach in these situations is to learn more about the fear, face the fear and overcome it. That’s usually the case with bankruptcy-phobia. However, in some cases, it’s better to simply avoid… Read More »
Does Bankruptcy Solve My Tax Problem?
The Illinois Department of Revenue has very broad wage garnishment powers. With as little as ten days’ notice, the IDR can order your employer to deduct up to 15 percent of your paycheck to pay past-due state taxes. Most families barely make ends meet. A 15 percent pay cut is often a devastating financial… Read More »
Is It Better To File A Chapter 7 Or A Chapter 13?
The expected flood of post-coronavirus lockdowns is more of a trickle. However, that statistic is not very comforting to the millions of people who are experiencing post-coronavirus financial stress. Making matters worse, in the mid-2010s, the Supreme Court diluted some key consumer protections in the Fair Debt Collection Practices Act. Therefore, creditors are more… Read More »
Does Filing Bankruptcy Affect My Ability To Buy A Car?
Yes, but in most cases, the effect isn’t nearly as drastic as some people believe it is, especially if the debtor filed a Chapter 13 bankruptcy. That’s good news for these debtors who drive used cars. Cars typically last about eight years. If a vehicle is more than three years old, and your Chapter… Read More »
Can You Have A Security Clearance With Bankruptcy?
The defense budget is the largest component of the federal budget. Much of this money goes to private security contractors. A high security clearance is usually a basic job requirement for these positions. Quite understandably, distressed debtors who rely on their security clearances are very hesitant to take any action that could threaten it…. Read More »
Reducing Debt Through Informal Talks
It is easy to see why medical debt is the leading cause of bankruptcy filings. Over 100 million American adults have such debt. Furthermore, a significant number of these people don’t think they’ll ever be able to pay it off. In as little as six months, Chapter 7 bankruptcy eliminates most medical and other… Read More »
Does Bankruptcy Protect Social Security Benefits?
In a word, yes. Generally, bankruptcy exemptions protect property, but they don’t protect income. According to the Social Security Administration, Social Security benefits are property, even though these benefits come in monthly installments, like income. So, even in the unlikely event trustees (people who oversee bankruptcies for judges) try to seize these benefits, the… Read More »
A Chapter 13 Timeline In Illinois
Most people file Chapter 13 bankruptcy to stop foreclosure. The mortgage delinquency rate has dropped since the 2008 crisis, but it’s on the way back up. One or two past-due mortgage payments usually trap homeowners in a downward spiral. After the bank sends an acceleration notice, which it usually sends quickly, it stops accepting… Read More »
