Monthly Archives: December 2014

What is it like to run a solo bankruptcy practice with a large family?

Well, it’s awesome.  I control my hours, I have time for my family, and I have a one-on-one relationship with each of my clients.  Having a hard-working, supportive wife makes all the difference in the world.

However, it also means that I sometimes keep odd hours, even at odd places.  For instance, today is New Year’s Eve.  I am in a hospital room with my lovely wife and our newborn son.  They are asleep, and I am working on my laptop on a bankruptcy petition for some clients who are in a real bind.  I don’t mind, and careful planning and a very understanding wife make the solo practice/family lifestyle possible.

Here is a picture of my view from the hospital room.  window1

 

 

 

 

Here is a picture of my work station (laptop sitting on sofa/bed converted to a very uncomfortable desk).  window2

 

 

 

 

 

And, of course, here is a picture of the bouncing baby boy (with no picture of Mom, because I didn’t dare wake her to ask her permission).  window3 dad with baby

 

Have a Happy New Year.  I know that I will.

A creditor just garnished/levied our Christmas money from our bank account. If we file bankruptcy can we get it back?

No.

First, as to bankruptcy, once you file it, it stops collections from your creditors AFTER you file bankruptcy.  So, if you file bankruptcy today and get garnished tomorrow, your attorney should be able to get the money back.  However, if you get garnished today and go bankrupt tomorrow, the creditor gets to keep the money.  genie

Second, your bank is going to put those frozen funds on hold for 20 days, but they’re really gone.  The bank will freeze the funds to see if you file an objection to the bank levy with the Utah State Courts.  You can object to a levy for any number of reasons, but it generally comes down to two categories:

1.  exempt funds (the garnished funds were social security, disability, or child support).  You can object to the levy and get the money back, or

2.  it wasn’t your money (the garnished funds were funds held for your parents, or your spouse who was not subject to the levy, or something along these lines).  In this case you might be able to get the money back as well.

But as for bankruptcy, it will not help you get the money back.  Once that genie of levied cash is out of the bottle, there’s no getting it back in through bankruptcy.

If I use my credit card right before I file bankruptcy, can they object and throw it out?

Kind of, maybe, but it’s a little complicated.

Short answer:  probably not.

Long answer:  Creditors can object to your bankruptcy filing and argue that it was made in bad faith.  This is very rare.  If this happens, your entire bankruptcy case is thrown out.

Creditors can also file a bankruptcy court lawsuit against you called an “adversary proceeding.”  This is much more common.  If you make credit purchases within 90 days of filing bankruptcy, there is a presumption that you did those in contemplation of bankruptcy.  (You charged up a card knowing that you would bk it).  In this situation, a creditor can file the adversary proceeding and get a bankruptcy judgment against you that says that those charges are not discharged by the bankruptcy.  In other words, you still have to pay those charges back.

There is a stronger likelihood of this happening if you are purchasing luxury items, such as a big screen tv or a trip to Hawaii.  Incidental charges for a gas fill up or a small grocery run probably won’t sink your case.  However, morally, it’s wrong to charge up your card knowing that your going to bankrupt it.  Even if it’s right before Christmas.  Going bankrupt after a job loss or a huge medical bill is one thing, but charging up your cards knowing that you will never pay those debts back is wrong.  charge it

Merry Christmas!

As I was walking towards court today for chapter 13 bankruptcy 341 Meetings, I was greeted by this charming fellow. santa

He was surrounded by Utah Transit Police who were busy handing out candy on his behalf.

He knew me by name, which makes me think that maybe this was the real Santa Claus after all.  He was kind enough to pose for a picture, while we had a police officer take my picture.  (First time experience for me, glad it wasn’t a mug shot).

He wished me a Merry Christmas, and I thought I’d do the same for all of you.  Merry Christmas!

Will we lose our WIC benefits when we file bankruptcy?

No.

Bankruptcy discharges your financial obligations to creditors for debts such as medical bills and credit cards.  It does not negatively impact your ability to receive government assistance.

WIC (for those of you who don’t know), stands for “Women, Infants, and Children” and is

The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) provides Federal grants to States for supplemental foods, health care referrals, and nutrition education for low-income pregnant, breastfeeding, and non-breastfeeding postpartum women, and to infants and children up to age five who are found to be at nutritional risk

and is part of the U.S. Department of Agriculture, Food and Nutrition Service.  Here in Utah, it is administered by each county.  For example, Salt Lake County’s website for WIC is here.  WIC gives food vouchers for families to use at stores for healthy food and baby formula.  It’s not food stamps, but is similar.

Filing bankruptcy does not affect your ability to receive any government benefits.  it definitely does not affect your eligibility to collect WIC.  According to the Salt Lake County Website, eligibility is determined as follows (bankruptcy is nowhere to be found on the eligibility standards):

Who is eligible for WIC?

  • Pregnant or breastfeeding women
  • A woman who has just had a baby
  • A child less than 5 years of age
  • Must meet income guidelines

Income Guidelines

Income is determined on gross income and frequency of pay. WIC counts all of the members of a household, related or unrelated. WIC counts an unborn baby as a household member.

Household Size* Annual Monthly Twice Monthly Bi-Weekly Weekly
1 $21,590 $1,800 $900 $831 $416
2 $29,101 $2,426 $1,213 $1,120 $560
3 $36,612 $3,051 $1,526 $1,409 $705
4 $44,123 $3,677 $1,839 $1,698 $849
5 $51,634 $4,303 $2,152 $1,986 $993
6 $59,145 $4,929 $2,465 $2,275 $1,138
7 $66,656 $5,555 $2,778 $2,564 $1,282
8 $74,167 $6,181 $3,091 $2,853 $1,427
Each additional
family member, add
$7,511 $626 $313 $289 $145

*Utah WIC Program Income Eligibility Guidelines

July 1, 2014 to June 30, 2015

How can I find out how much my tax refund will be next year?

Use an online tax estimator.

Remember that in bankruptcy, we want to file a chapter 7 case AFTER you have received and spent your tax refund.  Otherwise, you’ll lose the refund to the bankruptcy trustee.  I was sitting down with a young couple yesterday who had received a $6,000 tax refund last year (April of 2014) and had no idea how much their refund was going to be next year (April of 2015).

If your income is the same this year as last year, then odds are that your refund will be about the same as well.

However, if you want to run an online tax estimator, it will take you about 2 minutes to get a good estimate on how much your refund will actually be.  You simply need a paystub with your year to date totals, along with total deductions, and it is as simple as typing the numbers into an online calculator for a guesstimate of the upcoming refund.

My personal favorite is the HR Block tax estimator.  Not because it is necessarily better than any others out there, but simply because I used it first years ago and had a good experience.tax estimator

This is something worth spending a few minutes on;  you don’t want to delay filing bankruptcy if you’re refund will be small, and you don’t want to rush your bankruptcy if you could miss out on a good refund that could buy a lot of simple necessities for the family.

Can you make my doctor start seeing me again after I file bankruptcy?

No.  Bankruptcy can wipe out (or discharge) your medical debts.  However, just because those past-due medical bills have been wiped out, your doctor does not have to start seeing you again, or keep seeing you.  In other words, bankruptcy cannot force your doctor into indentured servitude.  doctor office

Medical bills push most of my clients into bankruptcy.  Larger organizations, like major hospitals, take the hit from the bankruptcy and will still see my clients the next day for new services.  However, smaller medical practices are hit harder by the bankruptcy, both financially and personally.  For example, if we list your orthodontist in the bankruptcy, he probably won’t want to see you again to do follow-up work on those braces.  For smaller practices, the only way to start seeing them again is to pay them back, even if the debt was properly discharged in the bankruptcy.

This doesn’t mean that the doctor is violating the automatic stay in bankruptcy by collecting on debts discharged in the bankruptcy.  He is refusing to do future work for you unless you pay what you owe.  It’s a fine point.  Bankruptcy doesn’t stop you from voluntarily paying back some creditors, and it doesn’t force those creditors to give you free services after you file your case.

So, in essence, you can wipe out those medical debts, but you’d better find a new doctor.  Otherwise, you’ll end up paying off those bills just to keep the same physician.

Does anyone file bankruptcy at Christmastime?

Barely.

My children are used to our Decembers being a little on the lean side since people don’t file bankruptcy right before Christmas unless they have a dire emergency.  February and March are the boom time for us.  Most of my clients are waiting for tax refund season to kick in.  If they file bankruptcy too early, they’ll lose their tax refunds next February.  Most of my potential clients aren’t  calling (or so I imagine), because no one wants to deal with bankruptcy (emotionally) right before Christmas.  The holidays are stressful enough without adding me to the mix.

The only people I see this time of year have imminent garnishments and foreclosures.  Everything else can wait.

I checked the Utah Bankruptcy Court website for December filing statistics, and here’s what I found:

November 2012 ….. 1275 cases filed

December 2012 … ..929 (346 case drop)

November 2013 …..1038

December 2013 ……873 (165 case drop)

November 2014 …..926

December 2014 ….. (no idea, but it feels low).

If you notice, cases drop from November to December.  I expect this year to be more of the same.

Which bankruptcy attorney in Utah has the best online reviews, and can you trust online reviews?

First:  I have no idea.  “Best” is a pretty subjective test, but i can say that the attorneys who have a lot of good reviews seem to deserve them.  For example, if you search for Berry and Tripp, you will find that they have 24 google reviews.  Honestly, Berry Tripp has been around forever, and they do a very good job, and their reviews are glowing.

As for whether or not you can trust online reviews, I want to say yes, but with a tiny bit of hesitation.  There will always be an angry crackpot out there with an axe to grind who posts an awful review.  You can usually discount those right away.  I have heard that you can buy canned reviews, but I have only seen it a couple of times, and the reviews just don’t sound right.  As for the rest of the reviews, people seem genuine in their reviews.  online review

For example, I have received a few new client reviews in the past two months, and they seem genuinely pleased.  I try to take care of my clients, especially since they have my cell phone number and don’t seem to hesitate at all in contacting me if there is a problem.  Here are those recent reviews, which I do trust:

https://plus.google.com/107797645626835804975/about?hl=en

Aspen Anderson
(in the last week)
Mr. Payne’s process belies his name, because it isn’t ‘payneful’ at all! Seriously. With his help, it was easier than we expected to be. We used Mr. Payne for the bankruptcy of a good friend of mine that I helped through the process. He responded to e-mails quickly and efficiently, he was personable, and we felt secure that we were both getting a reasonable amount of work for a reasonable price, and that he was available to assist us in any way we needed. He really made a very stressful situation manageable.
Mary Hansen
Mary Hansen
(in the last week)
After going to two different attorneys with questions regarding bankruptcy, I found Robert’s website. I admit that what initially interested me was his humor on the website. I emailed and called with questions and he was always very prompt in his responses and once we decided to file, we felt he was very honest and open about the process. He made it so easy and walked us through the process of Bankruptcy, which was stressful and scary for us. He never seemed tired of my endless questions or concerns and would always reassure us of whatever issue I had questions about. He is very professional, very willing to go the extra mile in his customer service, and not arrogant like some other attorneys that I had dealt with previously. I highly recommend Robert Payne if you are considering a bankruptcy. After working with him, I can tell you that he will set your mind at ease, help you through this stressful time in your life and help you to start moving forward. It really is simple with him in your corner to get control of you financial situation once more.
Kirk Medsker
Kirk Medsker
(2 months ago)
Robert is an amazing bankruptcy attorney. I hope I’ll never have to use his services again, but he made the process very painless. Bankruptcy is stressful, but Robert was always available (even after hours) to answer my questions. I interviewed at least 10 attorneys, and chose Robert because he really cares about his clients and will go the extra mile to help you out. He was very patient and didn’t mind answering my anxious ‘what if’ questions every week. 😉 Thank you again Robert!
Sandra Puefua
Sandra Puefua
(in the last week)
I definitely recommend Robert to help with Bankruptcy. He was easy to get a hold of, easy to talk to, and all around helpful. I’m so glad we went with him. Things were so quick and easy, next thing we know, our bk was discharged. Even after the bk, I still ask him questions, and get answers quick. Thanks Robert for all your help!
Autumn Larsen
Autumn Larsen
(in the last week)
Robert is so personable. He gave us some wonderful advice for debt settlement, and was such a pleasure to work with. Thanks Robert!

Are bankruptcy filings decreasing in 2014?

Yep.

I was reading an article that just came out on the ACA International website (Association of Credit and Collection Professionals) that showed that nationwide, bankruptcy filings in November were 16% lower than November of last year (2013).  http://www.acainternational.org/creditors-november-bankruptcy-filings-decline-16-percent-from-2013-34436.aspx  This was show by comparing the 62,403 filings in November 2014 with the 74,070 in November of last year.

The article went on to quote the ABI Executive Director (American Bankruptcy Institute) who stated that:

“Bankruptcies will continue to recede amidst tepid consumer spending, sustained low interest rates and high costs to file for both consumers and businesses,” said ABI Executive Director Samuel J. Gerdano. “We are on pace this year for bankruptcies to be well under one million filings, the lowest total since 2007.”

In other words, this will be the lowest year of bankruptcy filings in the past 7 years.

I do have to disagree with the ABI on the reasons for less bankruptcy filings.  In my practice, I am seeing less people file bankruptcy because they are currently underemployed (working a part-time job that doesn’t quite pay the bills), living with family, and don’t have enough money to file bankruptcy.  I know, that seems like a contradiction, being too poor to file bankruptcy, but I see it over and over.  There is not a “high cost to file for both consumers and businesses.”  In fact, bankruptcy attorney’s fees (at least in chapter 7s), have dropped over the past 7 years or so.  It is simply the fact that people now can’t afford to scrape up the retainer and filing fee to get it done.