Discharging tax debt in bankruptcy gets lots of families out of a horrible hole. Tax debt can be large and swelled beyond the tax by interest and penalties. Collection on old tax debt often compromises the ability to stay current on more recent years. Bankruptcy can save their bacon because taxes found on returns […]
Is There Life After Bankruptcy?
Is bankruptcy worth it? If you see filing bankruptcy to get a fresh start as painful or less than honorable, you might wonder what life is like, on the other side of bankruptcy. What’s the return on taking the big step? I got a report from the other side this week from a Chapter 7 […]
The Foreclosure That Was Longer Than War & Peace
Foreclosure is coming. Whether by choice or circumstances, you know the bank will take the house. Should you start packing immediately? The way banks are currently operating, the answer is: not yet, not soon, not for a long time. For one of my clients, the answer to how long was well more than 735 days. And they did […]
Pay Off Credit Cards Without Interest And Be Debt Free
The sixtyish client sitting in my office had assets worth 10 times his credit card debt. What could bankruptcy possibly do for someone who was solvent? His problem was liquidity and an income that was certain to decline in the next few years. His generous disability income would end at 65, leaving him with only […]
How One Family Settled Huge Debt For Pennies
When he started the Chapter 13 trek, he owed $370,000 in personal loans and credit cards. As he completes his plan, he will have settled that debt for three cents on the dollar. No tax is due on the forgiven debt and no listed creditor can legally come back to try to collect the difference. […]
Silicon Valley Horror Story: The Business Credit Card That Bit
I’ve long said that there is no credit card for which a real, live human being isn’t liable. (That may be an exaggeration, but not by much.) And I’ve long worried about the prospects for success of business startups financed on credit cards. But I’ve never seen a departing employee of a start up stuck […]
The One Person You Must Tell About Your Bankruptcy
Most people who file bankruptcy don’t want anyone else to know. Some of my clients try to hide their break for financial freedom from friends and neighbors. Others are worried about their boss finding out. Occasionally, someone will try to keep it from their mate. But trying to hide his bankruptcy nearly cost one client […]
The Flat Wrong 1099
When her soon-to-be-ex filed bankruptcy, my client got a 1099-C for the joint credit card. The form claimed that the debt was cancelled. Therefore, she had additional income equal to the card balance. Only, none of the statements on the 1099 were true. The debt wasn’t discharged as to the non filing spouse. One spouse’s […]
Divorce And The Ticking Debt Bomb
Debts of the marriage often outlive the marriage itself. And, those left-over debts are nothing but trouble. But too often, divorcing couples don’t mop up the joint debts they held during the marriage, only to have the situation blows up years later when one ex-spouse hits financial trouble. Here’s a true story that illustrates the danger. […]
Worthless Mortgage Liens Keep Homeowner At Risk
The client originally had his choice of bankruptcy chapters. He could file Chapter 7, get quick relief, and put “everything” behind him. Or his could file Chapter 13, propose a plan that would strip the mortgage lien and pay the taxes that wouldn’t be discharged in Chapter 7. He chose 7, and briskly got a […]
