Chapter 13 Bankruptcy Advantages

Here are posts by my colleagues at Bankruptcy Law Network telling us the advantages of filing chapter 13 bankruptcy.

Top 5 Reasons to File Chapter 13 Bankruptcy

Advantages of Chapter 13 Bankruptcy

Why File Chapter 13

13 Reasons to File a Chapter 13 Bankruptcy


Photo Credit: LicenseAttribution Some rights reserved by walknboston

Bankruptcy & Military Veterans

Today November 11, 2012, we pay tribute to and thank our military veterans for their service to our country. Here are some resources for military veterans on debt, loans and bankruptcy:

Can a debt collector garnish my federal benefits?

What is a VA loan?

Reaffirming a home loan

Bankruptcy for veterans

Can a veteran get a VA home loan after bankruptcy?

American Bar Association directory of resources for veterans

Bankruptcy reform lifts basic protections for veterans

Virginia bankruptcy exemption for disabled veterans

legal help for Kansas veterans

Will the bankruptcy trustee take my disability check?

Creditor Claims on Your VA Benefits

Are veterans benefits income under the bankruptcy means test?

Protection of exempt public benefits

Photo credit: AttributionNo Derivative Works Some rights reserved by xalamay

Does My Name Have to Be in the Newspaper When I File Bankruptcy?

It is nobody’s business you say. IT IS EMBARRASSING! Why does my name have to go in the newspaper when I file bankruptcy?

Some Kansas newspapers publish the names of people who file bankruptcy in their print and internet editions. Bankruptcy court filings are public records and you cannot stop the newspapers from getting the information or publishing it.

You might be able to prevent your name from appearing in the newspaper by carefully choosing where you file your bankruptcy case, but you might not be successful. The U.S. Bankruptcy Court for the District of Kansas has three divisions in Topeka, Kansas City and Wichita. Any Kansas case can be filed in any division the debtor chooses where to file.

The Kansas City Star does not publish your name unless you are known well enough to merit a news story. The Topeka Capital-Journal used to publish a list of all bankruptcy cases filed in the Topeka division, but stopped that practice several years ago. The Wichita Eagle-Beacon publishes a list of debtors who file in the Wichita division. The Hutchinson News publishes a list. The Lawrence Journal-World publishes lists of Douglas county residents who file bankruptcy in Kansas. Other papers, business journals and legal news publish bankruptcy cases.

Editorial policies change and there is no guarantee you will be able to stay out of the newspapers. Seek the advice of your bankruptcy attorney to determine whether you can successfully keep your name out of the paper.

Revised and reprinted from my post in my national blog Bankruptcy Law Network.

Photo Credit:
Some rights reserved by nvainio

Chapter 13 Plan Tweaked

The mandatory chapter 13 form plan for Kansas has been tweaked by the bankruptcy court. The changes go into effect for cases filed on or after December 1, 2012, per the standing order 12-1. The changes were made after receiving recommendations from the bench-bar committee.

Here is a redlined version of the two paragraphs changed in the mandatory chapter 13 form plan: [Read more…]

Means Test Meaner Again

Median income fell making bankruptcy means test meaner again for Kansas debtors seeking bankruptcy relief after November 1. All family sizes had drops in income since the May 1, 2012. The largest decreases were $1210 for single earners and $1864 for two-person households.
1 – $41,714  down $1210
2 – $55,698 down $1864
3 – $64,571 down $263
4 – $74,853 down $106
5 – $82,353 down $106
–  add $7500 for each additional person.

This drop in income makes the means test harder to pass for consumer bankruptcy cases filed on or after November 1. Debtors who earn less than the median income pass the means test on the first go around. Debtors who earn more than the median income must go on to round two and complete a complicated analysis of income and expenses to determine if they have disposable income to pay their unsecured creditors at the end of the day. The means test is supposed to tell if a debtor has money left over after living expenses to pay creditors. It says, at least in theory, whether filing a chapter 7 bankruptcy would be abusive or if a chapter 13 payment plan bankruptcy is required.  It also determines if the payment plan must be at least three years or five years.

Most Kansas Debtors Pass Means Test

Don’t despair, the means test is not a problem for most Kansas debtors.  Even for those people who are required to file a chapter 13 payment plan, the payments are usually far, far less than paying all the debt.  The interest, penalties and late fees also stop in most cases. Many times, very little of the general unsecured creditors are paid back in a chapter 13 bankruptcy case. The income figures are based upon census data by family size for your state. The U.S. Trustee Program publishes a table of median income for use in future bankruptcy cases. Official Bankruptcy Form 22A or 22C (Statement of Current Monthly Income and calculations). Bankruptcy Form 22A is the chapter 7 form. Form 22C is the chapter 13 form.



Bankruptcy Alphabet – B

Bankruptcy is a fresh start for people who need relief from their financial problems. Here are terms  from the world of  bankruptcy defined by fellow attorneys around the country.

Bad Faith Filing by Miami Bankruptcy Attorney, Dorota Trzeciecka. Bailout by Jacksonville Bankruptcy Attorney, Monica D. Shepard. Bank Account by New York Bankruptcy Lawyer, Jay S. Fleischman. Bank Account by Daniel J. Winter, Chicago Bankruptcy Attorney. Bank Account by Levy Philadelphia Bankruptcy Lawyer, Raymond Kempinski. Bank Tips  by Wisconsin Bankruptcy Lawyer, Bret Nason

Bankruptcy by Taylor Michigan Bankruptcy Lawyer, Christopher McAvoy. Bankruptcy Abuse Prevention and Consumer Protection Act by Livonia Michigan Bankruptcy Attorney, Peter Behrmann. Bankruptcy Estate by Metro Richmond Consumer and Bankruptcy Attorney, Mitchell Goldstein. Bankruptcy Mill by Chicago Bankruptcy Attorney, Kyle A. Lindsey. [Read more…]

NACBA Fall Workshop Registration Open

Registration is open for the National Association of Consumer Bankruptcy Attorneys (NACBA) fall member only workshop Nov. 2-3, 2012, at Amelia Island, FL.

NACBA is the only national organization dedicated to serving the needs of consumer bankruptcy attorneys and protecting the rights of consumer debtors in bankruptcy.

Attorney Jill Michaux is co-track director for fundamentals and will be speaking.

“Crafting Feasible Chapter 13 Plans - Plot the course of your chapter 13 plan to reach home port without running aground on statutory shoals.” Panelists will be Cathleen Moran (Mountain View, CA) and Jill Michaux (Topeka, KS)

“Case of the Dishonest Debtor. When to keel haul your client. Issues surrounding conflict between a difficult client, candor to the tribunal and the truth.” Cynthia Grimes,  (Lenexa, KS), Jill Michaux, (Topeka, KS), and Hon. Thomas Waldon (Ret.) (Tucson, AZ).


Kansas EIC Bankruptcy Exemption Constitutional

A second  judge ruled Thursday that the new Kansas statute exempting one year of earned income tax credit from creditors  in bankruptcy proceedings  passes constitutional muster.

Hon.Robert Nugent, Chief Judge of the U.S. Bankruptcy Court for the District of Kansas, joined the previous ruling of his colleague, Hon. Janice Miller Karlin, in finding K.S.A. 60-2315 constitutional.  Chapter 7 bankruptcy trustees in  Topeka and Wichita have filed hundreds of objections to the use of the EITC exemption by debtors in bankruptcy. An appeal of the earlier ruling in the Topeka Division is pending before the Bankruptcy Appellate Panel for the  10th Circuit of the U.S. Court of Appeals in Denver.

Tax refunds and earned income tax credits have been collected from debtors to pay commissions to chapter 7 bankruptcy trustees and then pay a small dividend to creditors.  Under the new Kansas law, trustees will not be allowed to take the earned income tax credit portion of the tax refunds for the year of the bankruptcy case filing.  The law reduces substantially funds available for chapter 7 bankruptcy estates.

The exemption statute adopted by the 2011 Kansas Legislature “insures that a bankrupt Kansan’s earned income credit goes to pay the rent or buy her family food, not a prepetition creditor’s claim. All of this is consistent with the federal law and does not infringe upon the Constitution’s Supremacy Clause,” Judge Nugent wrote.

Both judges dismissed all the challenges to the exemption statute by the bankruptcy trustees and ordered the earned income tax credit refunds released to debtors. That is good news for hundreds of low income, working families in Kansas who desperately need the money to pay for their necessary living expenses.

Read Judge Nugent’s decision, In Re Lea, Case No. 11-11131. Read Judge Karlin’s decision, In Re Westby, Case No. 11-40986.

K.S.A. 60-2315  An individual debtor under the federal bankruptcy reform act of 1978 (11 U.S.C. § 101 et seq.), may exempt the debtor’s right to receive tax credits allowed pursuant to section 32 of the federal internal revenue code of 1986, as amended, and K.S.A. 2011 Supp. 79-32,205, and amendments thereto. An exemption pursuant to this section shall not exceed the maximum credit allowed to the debtor under section 32 of the federal internal revenue code of 1986, as amended, for one tax year. Nothing in this section shall be construed to limit the right of offset, attachment or other process with respect to the earned income tax credit for the payment of child support or spousal maintenance. History: L. 2011, ch. 25, § 1; Apr. 14.

Four chapter 7 bankruptcy trustees mounted an all-out attack on the newly enacted Kansas statute exempting the EITC  from creditors for debtors in bankruptcy, but failed to convince either  judge that the Kansas Legislature can’t make a law saying a citizen may keep earned income tax credits for one year away from her bankruptcy trustee and creditors. Jill Michaux filed a friend of the court brief in the Westby case for the National Association of Consumer Bankruptcy Attorneys (NACBA) and is c0-c0unsel with debtor attorney Bruce Barry of Manhattan in representing the Westbys in the appeal. The Kansas Attorney General, represented by Assistant Attorney General Derenda Mitchell, intervened in the cases to support the new law.

Photo Credit: flickr LicenseAttribution Some rights reserved by Fried Dough  David Defeats the Giant


Kansas Attorney Disbarred for Mortgage Modification Scam

The Kansas Supreme Court disbarred attorney Tracy D. Weaver of Overland Park today for running a mortgage modification scam.

“Respondent took money from thousands of distressed and vulnerable mortgagors; he gave most of that money to nonlawyers and did nothing on behalf of the mortgagors; and then respondent refused to refund the fees to the dissatisfied clients as his advertisement had promised. Disbarment is the appropriate sanction.”

Read the opinion of the Court in In the Matter of Tracy D. Weaver, Respondent, No. 107,313, July 13, 2012.

Bankruptcy Means Test Nicer to Kansas Debtors Today

The bankruptcy means test got a little nicer to Kansas debtors today as median income figures rose for cases filed on or after May 1, 2012.

Here is the new median family income by family size for Kansas debtors in bankruptcy:

1 earner $42, 924 (up from $41,611)

2 people $57,562 (up from $55,801)

3 people $64,834 (up from 62,850)

4 people $74,959 (up from $72,665)

add $7,500 for each individual over 4 (same).

This is good news for Kansas debtors in bankruptcy. The increase in the median family income will mean more Kansans will qualify for chapter 7 bankruptcy or will have 3 year chapter 13 payment plans instead of 5 year plans.

Photo credit: LicenseAttribution Some rights reserved by kirstyhall

Bankruptcy Alphabet – A

Adversary Proceeding
Automatic Stay
Automatic Stay
Automatic Stay
Automatic Stay
Automatic Stay
Avoidance of Preferential Transfers

Bankruptcy Copy Fees Up 25%

Fees to download bankruptcy documents from the federal court increased 25% to 10 cents per page today. The fee is capped at $2.40 per document, there is no fee for access to court opinions, and fees are waived for users who incur less than $15 of use in a quarterly billing cycle.

All documents with the bankruptcy court are filed electronically using the Court’s case management electronic case filing (CMECF) computer sosftware. As each document is uploaded to the Court, it is docketed and an index of documents and events is created for the case. A copy of the filing is automatically sent to all the attorneys involved in the case and to interested parties who have requested notice. Individual documents can be downloaded by clicking on the hyperlinks in the case dockets.

You must have an account with the federal judicial system’s Public Access to Court Electronic Documents (PACER) system to download documents. You will log in to PACER to view the document or docket report links in the emails you receive and the fees will be assessed to your account.

Some courts allow PACER users to monitor cases by email via an RSS feed.  To learn if your bankruptcy court has implemented RSS, go to the PACER website and click on the RSS feed information. Kansas bankruptcy court does not yet offerRSS service.


Mark Neis Named Consumer Bankruptcy Super Lawyer


Mark Neis has been named a Super Lawyer in consumer bankruptcy law.

Super Lawyers magazine names attorneys in each state who received the highest point totals, as chosen by their peers and through the independent research. Rising Stars names the state’s top up-and-coming attorneys.

Super Lawyers magazine is published in all 50 states and reaches more than 13 million readers.

When Will My Underwater House Break Even?

Bankruptcy clients often wonder if they should keep their home when the mortgage balance is more than they can sell the real estate for.  Their heart says keep the home, their head says don’t — once they have the facts.

Here is a simple calculator from my friend, Cathy Moran at the Consumer Ledger, to estimate when an underwater house will be worth what is now owed.  Shocking!

Filing bankruptcy is an option that allows you to get out from under the mortgage debt but only if you give up the house.  As Jay Fleischman tells us on Bankruptcy Law Network, you don’t get a free house when you file for bankruptcy. Jed Berliner (a KU graduate) reminds us bankruptcy is not the end of the story — it is not so simple to give back the house to the mortgage company.

Bankruptcy Filing Fees Going Up

Starting November 1, 2011, the fee to file a bankruptcy case increases by $7.

The new filing fees are

  • chapter 7 $306
  • chapter 13 $281
  • chapter 11 $1046


Photo credit: AttributionShare Alike Some rights reserved by garryknight

Can I File Bankruptcy Again?

You have filed a bankruptcy before and now you need help with your debts again.  You are wondering when you can file a bankruptcy again and if you can get a discharge of your debts in the new bankruptcy case.

To determine if you can get a discharge in a subsequent bankruptcy, you should follow the 2 – 4 – 6 – 8 rule.  You count from the filing date of the old petition to the filing date of the new petition.

                                     2 years between 13s –1328(f)(2)

                                     4 years between an old 7 and a new 13  –1328(f)(1)

                                     6 years between an old 13 and a new 7  –729, 727(a)(9)

                                     8 years between 7  –727(a)(8)

Thanks to my blogging colleague from Bankruptcy Law Network, attorney Andy Miofsky of Southern Ilinois, who coined the term 2 -4 -6 – 8 rule.

Photo credit: AttributionNo Derivative Works Some rights reserved by / Doug Aghassi