Offsetting Necessary Expenses From Income
May 28, 2010 | by Richard Check
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.
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Bankrupt MLB Club Owes Star Nearly $25 Million
May 27, 2010 | by Richard Check
No one needs to hold a bake sale for Yankee’s star Alex Rodriguez, but it turns out that he is an unsecured creditor in the Texas Rangers’ bankruptcy. The Rangers officially filed Chapter 11 in Ft. Worth federal court yesterday, in part to orchestrate the sale of the club (for $575 million) to an investors group led by Hall of Fame pitcher Nolan Ryan and attorney Chuck Greenberg. The Rangers owe the third baseman about $25 million in deferred salary dating back to when A-Rod was a member of the team. He is the top unsecured creditor in the Rangers’ petition followed by five other baseball players. Unsecured creditors in a bankruptcy are those who have no security interest in a debtor’s physical property, and are usually last in line to get paid, if at all. Greenberg told the media, however, that the players will be paid in full.
Unsecured debt is debt that is not backed by collateral. In ordinary circumstances (outside of the world of superstar athletes), this can include unpaid credit cards, medical bills, utility bills, collection accounts, and personal loans. And sometimes a debt settlement can be an effective bankruptcy alternative for an everyday consumer in Wisconsin rather than an overextended sports franchise.
A debt consolidation lawyer can negotiate with unsecured creditors on your behalf perhaps without the need to file a Chapter 7 bankruptcy in Milwaukee. If you are in financial trouble, discuss your options with an experienced Wisconsin bankruptcy lawyer. He or she will work with you to obtain much needed debt relief in Wisconsin.
Leave a CommentYour Initial Bankruptcy Consultation
May 26, 2010 | by Richard Check
Bankruptcy is not suitable as a do-it-yourself proposition. The bankruptcy laws have a lot of complex technicalities which explains why you need a skilled legal expert to guide you in a personal bankruptcy in Milwaukee or in any other localities in Wisconsin. Here are a few things to keep in mind in an initial consultation with a Wisconsin bankruptcy lawyer.
Fully disclose all financial issues. Don’t hold back. As we discussed in previous blog entries, concealing any financial information is against the law. It can also result in a dismissal of the bankruptcy case, and in some instances can result in the debtor being locked up.
Answer the lawyer’s questions candidly. Some answers may be slightly uncomfortable, but to effectively represent you and provide you with sound legal advice, the lawyer needs you to put all your cards on the table.
Getting a second opinion is fine. As an informed consumer, it’s your prerogative to speak with more than one lawyer, but don’t shop around for another lawyer merely to spin a difficult situation more to your advantage, perhaps by withholding key facts.
A general practitioner or an inexperienced lawyer is not your best advocate. Look for an experienced bankruptcy attorney who practices in the bankruptcy courts ever day. That’s the kind of track record that you need for an individual bankruptcy in Wisconsin.
Finally, your friends and relatives will be very well meaning, but any final decision about filing a Chapter 7 bankruptcy in Milwaukee should be made in close consultation with a skilled legal professional who stays on top of the bankruptcy laws in Wisconsin.
If you need to file bankruptcy, choosing the right lawyer is critical. In many cases, the simple truth is that the more experienced attorney will do a better job, which means getting you the most benefit from filing and avoiding the mistakes that someone less experienced is bound to make.
Leave a CommentJudge Sentences Spouse For False Bankruptcy Reports
May 25, 2010 | by Richard Check
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.
Leave a CommentBig Increase in First Quarter Wisconsin Bankruptcies
May 24, 2010 | by Richard Check
Wisconsin bankruptcies increased by 20 percent in the first quarter of this year, the Milwaukee Journal Sentinel reports. Consumers and businesses filed about 6,000 bankruptcy petitions under the bankruptcy laws in Wisconsin as compared with approximately 5,000 in January-March 2009. Most of these petitions were of the Chapter 7 variety; a Chapter 7 liquidation is the most common form of an individual bankruptcy in Wisconsin. According to the article, “Among those coming to see bankruptcy attorneys are laid-off workers or entrepreneurs who tried to survive by using credit cards to cover costs, hoping the economic downturn wouldn’t continue as long as it has.” Reaffirming some of our recent blog entries, the story also observes that “many small-business owners whose businesses have failed are declaring personal bankruptcy.”
The article notes that Wisconsin residents with good skills and expertise still can’t find work in a down economy despite their best job-hunting efforts: “Lawyers who handle bankruptcy cases said even though more analysts say the economy is turning around, it’s not happening fast enough to prevent people who’ve been fighting to stay afloat from declaring insolvency.”
If your personal and/or business financial affairs have reached the point of no return, a candid, confidential discussion with a debt consolidation lawyer may be extremely beneficial. A Wisconsin bankruptcy lawyer is a good person to have in your corner especially if you are currently unemployed and need debt relief in Wisconsin.
1 CommentBankrupt Candy Maker Gets Second Chance
May 20, 2010 | by Richard Check
Good news for Wisconsin consumers with a sweet tooth: As a follow up to a previous blog entry, the bankrupt Milwaukee-area candy company Quality Candy looks like it found a buyer and apparently will stay in business. Family owned Quality Candy, which has been in operation for about 100 years, filed for Chapter 11 bankruptcy in January. It was an unusual bankruptcy filing in that the company reported debts of $3.4 million but assets of about 4.4 million. A group of local investors have submitted a $2.2 million offer to buy the company, which needs the go-ahead of the bankruptcy judge. Quality Candy is also seeking court approval to get out of various leases at area malls. Under the bankruptcy laws in Wisconsin and other states, bankrupt companies for walk away from such leases if the bankruptcy judge approves. In this instance, it would allow the successor company to negotiate better lease terms with the shopping centers.
As we have discussed previously, a business entity can not file for a Chapter 13 bankruptcy in Milwaukee, but Chapter 13 is an option for an individual who is personally on the hook for business debts. If you operate a business that may be drowning in red ink, it may be time to turn to a Wisconsin bankruptcy lawyer for assistance. A Chapter 13 bankruptcy in Milwaukee may be the best way to cut your losses and move forward.
Leave a CommentVideo Rental Franchise Goes Bankrupt, Ends Operations
May 13, 2010 | by Richard Check
With intense competition from Netflix and others, bricks and mortar video rental stores have really fallen on hard times. Movie Gallery, Inc., the parent company of Hollywood Video filed for bankruptcy protection several months ago and closed several of its Milwaukee-area stores. After defaulting on one of its loans, the company notified the court on May 7 that it will shut down all of its approximately 1,900 remaining locations nationwide, including stores in Cudahy, Racine, and Kenosha. The chain has lost significant market share to the movies-by-mail or via online streaming offered by Netflix or local Redbox rental kiosks. Blockbuster Video has encountered similar issues, and may also wind up in bankruptcy. Blockbuster has already closed a number of its shops around the country.
As these corporations (as well as local small businesses) are finding out, consumer preferences can be fickle. If you own a troubled business in Wisconsin that may not be able to stay afloat in this difficult economic environment, a bankruptcy attorney in Milwaukee can help. A skilled Wisconsin bankruptcy lawyer can assess you assets and liabilities and develop a solution, which can include a Milwaukee small business bankruptcy, geared to your particular needs. While the bankruptcy law, for example, does not permit you to go Chapter 13 as a business entity, the petition can include business-related debts for which you signed a personal guarantee. So an individual bankruptcy in Wisconsin does provide some means for dealing with heavy debts that an individual might have piled up in a business.
Leave a CommentBankruptcy Can Sidestep Home Foreclosure
May 12, 2010 | by Richard Check
Last Sunday’s 60 Minutes broadcast created a lot of buzz with its segment about homeowners voluntarily allowing their overvalued mortgages to go into foreclosures. The CBS website explains:
Currently, about seven million homeowners are behind on their mortgages and that number is only getting worse. Banks, with the help of the government, are offering some relief to homeowners who’ve lost jobs and just can’t meet their payments. But there’s a growing number who can pay but are simply walking away from houses that are now worth as little as half of what they paid for them. It’s called "strategic default." People have done the math and decided making those monthly payments is just throwing money away, leaving the mortgage holders – the banks – as zookeepers of an ever-growing parade of white elephants.
But there is another option rather than a "strategic" or other forms of default: it is also possible to avoid Wisconsin bank foreclosures altogether by filing a personal bankruptcy in Milwaukee or in the surrounding area under Chapter 7 or Chapter 13. For one thing, a bankruptcy filing puts the bank’s foreclosure case on hold. Another factor to consider is the Wisconsin homestead exception, which is $150,000 for a married couple which could make your home safe from foreclosure. And even if you are thousands of dollars behind on your payments, a Chapter 13 petition may allow you to spread out the amount that you are behind over five years. This means that you only end up paying a very small percentage of that total every month and as far as your lender is concerned, the loan becomes current once again.
If you fallen behind on your loan payments through no fault of your own, contact a Wisconsin bankruptcy lawyer right away. Depending upon the circumstances, and what exceptions may or may not apply to your particular situation, you may be able to save your house and thereby keep your family under one roof through an individual bankruptcy in Wisconsin.
Leave a CommentFormer Piston Mahorn In Bankruptcy Court
May 11, 2010 | by Richard Check
We discussed the financial challenges facing the Texas Rangers baseball team in yesterday’s posting. The NBA playoffs also overlap with the beginning of the baseball season, and it appears that another retired NBA star is seeking 
Chapter 7 protection. Rick Mahorn, who played on the 1989 world champion Detroit Pistons and other teams during an 18-year NBA career, owes about $500,000 to creditors, but in court documents indicate that he has only about $200,000 in assets. Among other things, Mahorn apparently lost his suburban-Detroit home to the bank and owes thousands to the IRS. Although Mahorn makes a good income as a Pistons radio broadcaster, he told the Detroit News that "Like any normal American, I’m trying to find a job to better myself. I’m doing everything possible." One wrinkle in the case is that the bankruptcy trustee has indicated that Mahorn has yet to fully account for his NBA pension and at least one championship ring.
Nevertheless, Chapter 7 protection should allow Mahorn and his wife and five children to obtain a fresh start. According to Mahorn’s attorney, ""Rick’s in a very similar situation to other folks who have lived through bad investments and an uncooperative mortgage company."
Remember, Chapter 7 is an option for consumers from all walks of life. A Chapter 7 bankruptcy in Milwaukee is a way under the bankruptcy laws of Wisconsin that many consumers, usually of more modest income, obtain a financial breather through a full discharge of debts that have grown to an unmanageable level. By filing under Chapter 7 if necessary, an individual bankruptcy in Wisconsin can erase many of your bills, most likely allow you to keep your home and car, and enable you and your family to start over on a more solid financial footing. An experienced Wisconsin bankruptcy lawyer has the wherewithal to present a range of options for obtaining debt relief in Wisconsin.
Leave a CommentCreditors May Force MLB’s Texas Rangers Into Bankruptcy
May 6, 2010 | by Richard Check
With the baseball season in full swing, the ordinary perception is that owning a professional sports franchise is like a license to print money. Evidently not so. The Hicks Sports Group (HSG), the owners of the Texas Rangers, defaulted on $525 million in debt last year, and unhappy creditors may force the team into involuntary bankruptcy. The team and the creditors have evidently reached a stalemate in negotiations. Amidst this turmoil, Major League Baseball (MLB) may seize the team (under its "best interests of baseball" rule) to orchestrate the sale of the franchise to a group that includes team president Nolan Ryan, the Hall of Fame pitcher. Creditors, however, are said to be dissatisfied with that prospect because of other, higher offers that are on the table. The team owes money to 40 creditors, with the largest being Monarch Alternative Capital.
According to SportsBusinessJournal.com:
MLB is motivated in part to have the sale completed because it has been supporting payroll at the team since the default. But baseball may also be moving to act now because of worries the creditors could file an involuntary bankruptcy petition. At that point, baseball would not be able to exert the influence it could now, said Irwin Kishner, chairman of the corporate department at New York law firm Herrick Feinstein.
“In bankruptcy court, the judge wants to maximize the assets on behalf of the creditors,” he said.
As part of the deal, apparently the Ryan group is willing to pay HSG for land near the ballpark on which there are no creditor liens, which makes it the preferred buyer from HSG’s point of view.
All high-finance wheeling-dealing is a far cry from what might be involved in, for example, a Milwaukee small business bankruptcy voluntarily entered into by the business owner. Subject to certain unsecured debt limits, a self-employed individual or someone operating an unincorporated business is eligible for Chapter 13 relief under the bankruptcy laws of Wisconsin. By restructuring the amount owed, a Chapter 13 plan allows some debts to be paid off in monthly installments in a three-t0-five year period while discharging others. If you operate a business that’s on the verge of closing its doors because the debt load has become unmanageable, contact a bankruptcy attorney in Milwaukee. And depending upon the circumstances, you may be allowed to continue your business during the course of a Chapter 13 bankruptcy in Milwaukee or elsewhere.
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