Bankruptcy Procedure

Chapter 7 Bankruptcy Basics

For individuals (rather than businesses), there are two types of bankruptcy. Chapter 7 bankruptcy allows debtors to wipe out most existing debt, but there are strict income thresholds to qualify. Chapter 13 bankruptcy is a debt repayment agreement for higher-income people, that may or may not result in some of their debt being discharged at the end of the five year repayment plan. This blog overviews the basics of Chapter 7 personal bankruptcy. Read more>>
November 11, 2022

How To Lose A California House with An IRS Tax Lien in Bankruptcy

Bankruptcy, Bankruptcy Procedure, IRS, Loan Modification, Pre-Bankruptcy Planning, Tax Liens, Trustee

California increased the home equity people going through bankruptcy could keep in 2020: from $175,000 to $600,000, specifically so debtors wouldn’t lose their house in bankruptcy. It mostly works. Except with houses that have IRS tax liens on them. Read more>>
August 10, 2022

What Happens to Tax Liens In Bankruptcy?

Bankruptcy, Bankruptcy Procedure, IRS, Tax Liens, Taxes

Debtor’s often have Notice of Federal Tax Lien outstanding at the time they file bankruptcy. How are these handled? Broadly, a properly-noticed lien survives bankruptcy. It continues to attach to any property Read more »
January 11, 2022

Why Bankruptcy Attorneys Shouldn’t Accept Credit Cards

Bankruptcy, Bankruptcy Aftermath, Bankruptcy Procedure, Pre-Bankruptcy Planning

I don’t take credit cards. I don’t think it’s ethical, and here’s why Read more »
December 29, 2021

How the DOJ Can Mess Up Getting Rid of Tax Debt in Bankruptcy

Bankruptcy Aftermath, Bankruptcy Procedure, Taxes

Tax debt is dischargeable in bankruptcy. However, unlike many other nondischargeable debts (fraud, malicious tort, etc.), tax debt may actually remain in force with no further word from the court. Huh? The IRS or the FTB could come back five years after the discharge and start collecting on taxes Read more »
November 24, 2021

What Happens at a Bankruptcy 341 Meeting of Creditors?

Bankruptcy, Bankruptcy Procedure, Trustee

In chapter 7 bankruptcy, everything you own and owe is briefly transferred to a bankruptcy Trustee, who can then use your assets to pay your debts. If you have more debts than assets, then those debts are “discharged” or wiped out (there are exceptions for some debts… Read more »
November 4, 2021

Hard Truths for Debtors Who Procrastinate

Bankruptcy Procedure, Lawyering, Life Lessons, Pre-Bankruptcy Planning, Tax Collection Issues

Since the fall, I have seen a big uptick in desperate people calling me for tax or bankruptcy help. What kind of desperation? These people have been either on the IRS’s radar, or been having debt problems, for many years and then the crisis hits: the IRS puts a lien on a house, or a creditor gets a default judgment and the sheriff Read more »
September 23, 2021

Discharging Tax Debt in Bankruptcy

Bankruptcy, Bankruptcy Procedure, IRS, Taxes

It’s possible to discharge (have tax debt wiped out) most federal taxes in bankruptcy. There are exceptions, however. Many of the times when taxes aren’t dischargeable in bankruptcy are very straightforward, but one is open to interpretation and thus quite murky. Read more »
September 13, 2021

Sebastian Explains Why Selling Property for Less Than Market Value Before Bankruptcy is A No-No

Bankruptcy, Bankruptcy Procedure, Pre-Bankruptcy Planning

If a debtor sells property for less than full market value before filing bankruptcy, the law considers this a form of theft from the bankruptcy estate: the Bankruptcy Trustee could have sold it for more money to pay off the debtor’s creditors. But, sometimes Sebastian the Feline Paralegal’s explanations are more fun to read. Read more »
September 3, 2021

The Bankruptcy Trustee

Bankruptcy, Bankruptcy Procedure, Trustee

When you file a a chapter 7 bankruptcy, everything you own and owe is legally transferred to a Bankruptcy Trustee, who can then use your assets to pay your debts. Read more »
August 26, 2021

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