California Tax and Bankruptcy Blog

Paying For A Chapter 7 Bankruptcy

I almost always charge flat fees for chapter 7 bankruptcies, rather than charging by the hour. The fee covers all meetings, phone calls and strategizing with the client on when to file and how to minimize the chance of the Bankruptcy Trustee taking any assets, preparing the bankruptcy Petition that is filed with the Bankruptcy Court, the Court filing fee, coaching for and appearance at the 341 Meeting of Creditors, and all associated and follow up paperwork through the discharge of the client’s debts. My office also fields calls from creditors (usually credit cards), while we are waiting or preparing to file the bankruptcy. Read more »
April 8, 2026

Will the IRS Lower the Amount Owed If I Make a Lump Sum Payment?

IRS

No, the IRS won’t lower the amount owed, not even if you make a lump sum payment. Neither will California’s Franchise Tax Board (FTB), or any of California’s other tax agencies, the CDTFA (sales tax) and the EDD (unemployment tax). Tax agencies aren’t flea markets: they don’t haggle on price. And, unlike other creditors like credit cards, tax agencies do not see themselves as collections agencies (where getting paid what they can, even if it’s not all that’s owed) is the main goal. Instead, they see themselves as law enforcement agencies, where the main goal is get paid what is legally owed, even if they get nothing at all as a result. Why? Read more »
April 7, 2026

Will My Bank Close My Checking Account If I File Bankruptcy?

Bankruptcy, Bankruptcy Aftermath

No, your bank likely will not close your checking or savings account if you file bankruptcy. This often confuses my clients because I warn them that all their credit cards will be closed within days of filing a bankruptcy. What accounts for this difference? Read more »
March 2, 2026

How Public Is the Information in a Bankruptcy?

Bankruptcy, Bankruptcy Aftermath, Bankruptcy Procedure

Many clients worry about how public the information in a bankruptcy will be: who gets or can see the information in their personal chapter 7 bankruptcy? After all, when a person files bankruptcy, they are filing a 50-plus-page Petition that lays bare *all* of their income, assets, debts and financial transactions for the past 1-3 years. Since all bankruptcies are legal filings with the US Bankruptcy Court, they are public documents and, by definition, accessible to anyone. In reality, however, very few people have their bankruptcy found or seen by anyone other than the creditors listed in their bankruptcy Petition. Read more »
February 17, 2027

Reaffirming Car Loans in Chapter 7 Bankruptcy

Did You Know?

Debtors filing chapter 7 bankruptcy are often asked by the bank or car company holding their car loan to “reaffirm” their debt – to verify that they still owe the balance on their car loan. I’m often asked whether it’s required to sign these reaffirmation agreements. No, it’s not. As long as you are current on your car loan, the lender cannot repossess your car just because you filed bankruptcy. I recommend not signing a reaffirmation agreement, unless you can’t live without on-line access to your car loan account. Here’s why. Read more »
December 29, 2025

Business Bankruptcies Up for Restaurants, Contractors and Realtors in Los Angeles

Bankruptcy

I’ve had a 50% increase in the number of people calling me for bankruptcy this year. Nationwide, bankruptcy filings are up almost 20% in 2025. I’m getting more calls from small business owners than I am from individuals. But particularly hard hit appear to be owners of restaurants, contractors and real estate agents. Why? Read more »
November 6, 2025

Alternatives to Business Bankruptcy

Bankruptcy

I rarely recommend taking a failing business through bankruptcy. There’s usually a solution that costs less and gives the business owner more control over the winding-down of operations than bankruptcy. I most often propose a combination of (1) closing the failing business and walking away, (2) personal bankruptcy for business owners with personal guarantees on business debt, and (3) creating a new corporation for business operations the owner plans to continue pursuing. Read more »
July 11, 2025

Great Review from Ventura County

Did You Know?, IRS, Results, Taxes

I am always so pleased when I am able to secure a positive result for a client!

Trump and DOGE Attack on the IRS

Did You Know?, Policy, Taxes, Taxes in the News

The Washington Post recently enumerated the numerous political problems facing Elon Musk’s DOGE initiative (Department of Governmental Efficiency) like how it is grappling with bad public relations and is trying have its work seen as a win for the average citizen rather than as a callous and undisciplined attack on the country’s federal agencies. Read more »
March 25, 2025

How Threatening is the IRS Collections Notice I Just Received?

IRS, Tax Liens, Taxes

Almost everyone calls me in a panic after receiving a collections notice from the IRS threatening to levy on their bank account, attach their wages, or put a lien on their house. They all think it will happen immediately: “Please call me back ASAP because the IRS gave me a deadline of tomorrow/next week/10 days!!” Um, no. Chances are, you’ve got many months, if not years, until the IRS pursues aggressive collections action. Read more »
March 14, 2025

12 3 ›»