With the exception of a home mortgage, if you cannot pay your debts off completely within the next three years, you may consider filing for bankruptcy in order to protect your income and assets. If you file for bankruptcy, you may free up income so that you can begin to pay off your mortgage, save for retirement, or provide an education for your children or grandchildren.
You should not feel guilty or embarrassed for having filed bankruptcy. Psychologists say families, relationships and marriages fail most often because of financial pressures. If financial strain is damaging your health and personal relationships, you should consider bankruptcy.
According to the bankruptcy section of the uscourts.gov web site, a fundamental goal of the federal bankruptcy laws enacted by Congress is to give debtors a financial “fresh start” from burdensome debts. The Supreme Court made this point about the purpose of the bankruptcy law in a 1934 decision:
[I]t gives to the honest but unfortunate debtor…a new opportunity in life and a clear field for future effort, unhampered by the pressure and discouragement of preexisting debt.
Local Loan Co. v. Hunt, 292 U.S. 234, 244 (1934).
This goal is accomplished through the bankruptcy discharge, which releases debtors from personal liability from specific debts and prohibits creditors from ever taking any action against the debtor to collect those debts.
The common types of personal bankruptcy include:
Chapter 7 Bankruptcy
Chapter 7 Bankruptcy is the most common form of filing personal bankruptcy. Chapter 7 bankruptcy is often called a “straight bankruptcy”. With many technical exceptions beyond those listed here, all debts are discharged in Chapter 7 Bankruptcy except the following:
- Child Support
- Student Loans
- Most Traffic Tickets and Criminal Fines
- Most Taxes, including Federal Income Taxes
- Injuries Caused by Drunk Drivers
Chapter 7 Bankruptcy cases can potentially discharge debts for:
- Medical Bills
- Lawsuits for injuries caused while driving uninsured
- Credit Card Debts
- Debts following evictions and/or repossessions
- Lawsuits for breach of contract
- Small or moderate insufficient funds checks
- Most business debts
- Some fraud debts
Chapter 13 Bankruptcy
Chapter 13 Bankruptcy involves making payments over time to creditors. The payment plans can be as short as 36 months–even less if you can repay quickly–or as long as five years. Some people have problems that cannot be taken care of with a Chapter 7 Bankruptcy, and are better off filing a Chapter 13 Bankruptcy plan.
The following debts and problems can often be handled in a Chapter 13 Bankruptcy filing:
- Moderate to large insufficient funds checks
- Unpaid Child Support
- Criminal and Traffic Ticket Fines
- Reinstating a suspended driver’s license
- House payments that are several months behind
- Car payments that are several months behind
- Injuries caused by your intentional conduct (such as assaulting someone)
- Unpaid alimony or spousal maintenance
- Reducing a car payment to an affordable level
- Reducing a furniture or household payment to an affordable level
In a few rare cases, it can be necessary or advantageous to file a Chapter 7 Bankruptcy before a Chapter 13 Bankruptcy. These are sometimes called “Chapter 20 Bankruptcy” cases. For example, if you have high credit card debt that you cannot possibly hope to repay, but also have student loans or a suspended license because of many unpaid tickets and/or court restitution, it may be best to ask about a Chapter 20 Bankruptcy plan.
Chapter 11 Bankruptcy
Chapter 11 Bankruptcy cases are increasing in rarity. They are usually for large corporations or businesses, or individuals with many large debts as well as lots of equity in their assets. If you have a secured debt of over $1,010,650 and unsecured debt of over $336,900, you may have to file a Chapter 11 Bankruptcy instead of a Chapter 13 Bankruptcy, unless you are willing to file a Chapter 7 Bankruptcy. The decision to file a Chapter 11 Bankruptcy is a technical decision that our firm is well qualified to help you examine. Chapter 11 Bankruptcy cases are very expensive and infrequently recommended. Our firm is willing to put forth the effort necessary if you and your attorney agree that a Chapter 11 Bankruptcy filing is the best plan for your situation.
Bankruptcy is a prudent step towards rebuilding your financial future
The Law Offices of John Sterbick is a debt relief agency. We help people file for bankruptcy relief under the bankruptcy code. A consultation with the Law Offices of John Sterbick is important to ensure that bankruptcy is the right choice for you.
To learn more about your bankruptcy options and the most beneficial course of action for your financial situation, contact the law offices of John A. Sterbick to arrange a free consultation with John and our team of associates today. An expert bankruptcy attorney from our firm will outline all of the pros and cons for each option, and help you to confidently make your decision about your course of action. Our bankruptcy attorneys have more than 29 years of experience serving Tacoma-area and Washington State residents and businesses, so contact us today!
Internal Revenue Service (IRS) or State of Washington tax problems cannot be wished away, and do not just disappear!
It is common for people in this situation to just ignore the IRS letters they receive, and hope their IRS or State tax problems will just go away on their own. The fact is that they only worsen, and then before they know it, they are facing a wage levy, a bank levy, or a property seizure. You need professional legal expertise to obtain IRS and State tax relief. In Tacoma, and throughout the State of Washington, you need an IRS and Washington state tax lawyer who is up to the task. You need the IRS tax experts at the Law Offices of John Sterbick.
There still exists a persistent false belief that tax liabilities cannot be discharged in bankruptcy.
In reality, certain tax liabilities can be discharged or paid in Bankruptcy, depending on your individual situation. Whether you have old IRS or State tax debt or not, you need help from the Law Offices of John Sterbick. Not only does John Sterbick understand that tax liabilities can be discharged under an
- Offer In Compromise,
- Payment Plans,
- Uncollectible Status, or
The IRS tax experts at the Law Offices of John Sterbick also have the knowledge and expertise to help you meet the necessary criteria for your particular situation. John Sterbick will resolve your tax problems with the IRS or with the State of Washington to provide a solution to your tax debt.
John Sterbick, attorney-at-law, is an IRS tax law firm with offices located in Tacoma, Washington. As an IRS tax lawyer, he helps gain relief for taxpayers in Tacoma and across the State of Washington to solve their IRS and State tax problems in a timely manner. John Sterbick will fully and fairly represent you in whatever IRS tax problem you have in order to get the IRS tax relief you need. As an experienced IRS and State of Washington tax attorney, John Sterbick offers a broad range of IRS and State of Washington tax services covering everything from:
- IRS tax levies,
- IRS tax wage levies,
- IRS tax liens,
- IRS tax innocent spouse cases,
- IRS tax audit representation,
- IRS back taxes,
- IRS payroll tax problems,
- Discharge of liens from real property, and
- Obtaining uncollectible status
Washington state tax debt problems come from:
- Washington State Dept. of Revenue
- WA State Dept. of Labor and Industries
- WA State Dept. of Employment Security
Do not compound your IRS or State tax problems by ignoring them!
John Sterbick has a long, successful track record of negotiation and settlement with the IRS and with State of Washington Revenue officers on behalf of his clients. Don’t delay, call the Law Offices of John Sterbick now at (253) 383-0140 to get on an equal footing with the IRS or the State of Washington. Contact the IRS tax experts at the Law Offices of John Sterbick — we can protect you!