Wisconsin Bankruptcy Law

In a previous blog posting, we discussed the means test and the median family income as they relate to an individual bankruptcy in Wisconsin. The median family income as determined by the federal government varies from state to state and also depends on the size of your family.

The means test in part determines whether a debtor can file a Chapter 7 bankruptcy in Milwaukee (or elsewhere). Or, in the alternative, a Chapter 13 repayment plan. In other words, the means test is a line in the sand a between eligibility for a Chapter 7 liquidation or Chapter 13. In short, it can have huge financial ramifications about what, if anything, you need to pay back in a consumer bankruptcy in Milwaukee.

Before a debtor passes or fails the means test, various items that can be deducted from your income under the bankruptcy laws in Wisconsin. Although each situation has unique aspects, necessary expenses can include taxes, union dues, health and disability insurance, child care expenses, energy costs in excess of the national average, and job-related education, among others. To establish these expenses to the satisfaction of the bankruptcy court, you’ll need organized, valid records for at least six months prior to the bankruptcy filing.

Determining all the applicable exemptions and expenses in a bankruptcy case is a job for a trained professional. Millions of Americans file bankruptcy every year for one reason or another. Lawmakers created the bankruptcy code to help protect honest, hard-working people from suffering through their financial disasters. At the same time, the laws can be very tricky and technical, so it is essential to obtain guidance and input from an experienced Wisconsin bankruptcy lawyer. Do not go it alone.

This blog has been following the case of the now-estranged husband and wife team of daycare providers who apparently hid income after filing a Chapter 7 bankruptcy in Milwaukee. In April, the husband was sentenced to six months in prison for filing false reports. Yesterday, the second shoe dropped, when a federal judge sentence the wife, who had earlier pleaded guilty, to one year behind bars. Both spouses will also have to pay restitution and go on probation after they are released.

The Milwaukee couple originally went Chapter 13 in November 2001. Their case was converted to Chapter 7 in 2004. Separately and together, the couple received thousands of dollars from the state of Wisconsin’s taxpayer-subsidized childcare program during this time that apparently was not disclosed in the bankruptcy paperwork. According to the Milwaukee Journal Sentinel, from 2003 to 2008, the husband received about $725,000 from the state-sponsored program and the wife received about $540,000 just in 2008 alone. The Sentinel notes that “Federal, state and local authorities are investigating dozens of child care providers for possible fraud.” The couple is not charged in this investigation.

Under the bankruptcy laws in Wisconsin, a debtor must reveal all income, property, and liabilities. Concealing any financial information is against the law, and in some cases can result in the debtor wind up being locked up.  So it’s a very bad idea to try to engage in any form of creative bookkeeping. If you are considering an individual bankruptcy in Wisconsin, make absolutely sure that you have compiled a complete set of accurate financial records. You must provide your Wisconsin bankruptcy lawyer with all the documents relating to your personal and business debts so that he or she can address your financial needs in full compliance with the law.

The Milwaukee Business Journal reports that an increasing number of southeastern Wisconsin real estate developers have been forced into a personal bankruptcy in Milwaukee because of Wisconsin bank foreclosures in the commercial sector. The story explains that “Developers typically provide personal guarantees on their commercial mortgages, which means banks eventually pursue the developers personally for a judgment.” In general, a developer that has signed off on a now-defaulted, huge personal note for a commercial property can seek Chapter 7 protection if the lender decides to take the matter to court.

But as we have alluded to previously, Chapter 7 isn’t just for real estate moguls or entrepreneurs that have been undermined by fading property values. For most ordinary, hardworking Wisconsin consumers facing serious financial difficulties, a Chapter 7 bankruptcy in Milwaukee often allows homeowners to remain in their primary residence while the case works its way through court. Exemptions that among other things protect the residence were created in order to provide debtors with the basic essentials needed to help them achieve a fresh start. And during that time, any foreclosure attempts by the lender come to a grinding halt. Perhaps you’ve been downsized out of your job and can no longer afford your high monthly mortgage payments. Protection under the bankruptcy laws of Wisconsin may be an option for obtaining needed debt relief in Wisconsin. A step in the right direction might be to obtain guidance from a debt consolidation lawyer at the initial appearance of financial distress.

The bankruptcy laws in Wisconsin are designed to weed out fraudulent claims versus the people that genuinely deserve relief from their debts.  If you are considering filing for bankruptcy to knowingly skirt the legal system, or if you intend to provide false information to avoid responsibility for debt, please do not contact my office.  You will not be able to hire any respectable debt consolidation lawyer if you are trying to misrepresent yourself to the bankruptcy court.  Incurring new debt while only intending to file bankruptcy to avoid responsibility is not acceptable.  Good people start looking for bankruptcy help in Milwaukee when circumstances beyond their control cause their finances to get out of control.  An individual bankruptcy in Wisconsin is designed to help good, honest, hard working people get back on their feet and move toward a better future.

There are different kinds of debt that are considered fraudulent by the bankruptcy court, and I am familiar with them.  It is not in your best interest to hide anything from your bankruptcy attorney, as it may come back to bite you in the future.  If you think you may have a debt that may not be dis-chargeable, you can discuss that with me and I will be able to let you know whether bankruptcy is an option for you.  For more Wisconsin bankruptcy information, contact an attorney with experience and be honest about your situation.  It could be the very first step you take to get back on track.

Sometimes the worst thing people do when they face an overwhelming amount of debt is just look the other way.  Rather than assess their situations and really get an overall idea of what they are facing, they use the whole “out of sight, out of mind” approach.  Do not take this route!   Throwing out bills or not opening your mail will not make your problems disappear.  Pretty soon you might find yourself facing several lawsuits from creditors trying to collect on their debts and you won’t be able to stop them from taking the money directly from your pay checks.

It really might be time for you to consider that your debt has become unmanageable.  Milwaukee bankruptcy services are put in place to help people just like you.  These federal laws were not put into place to aid lazy deadbeats.  They were designed to help hardworking, honest people just like you that are facing difficult times.  You can find bankruptcy help in Milwaukee that will allow you to feel confident about yourself again.  You won’t fear your mailbox or wonder if you are going to be harassed when your phone rings.

You really do owe it to yourself to consider all of your options before just giving up.  Don’t admit defeat, but rather try to look forward to a positive future and consider what the bankruptcy laws in Wisconsin have to offer you.