Monday, September 9, 2013

Why I Can't Stand "Debt Settlement" Companies for Bucks County Families and Individuals, Part 1 Billion

I was speaking to a Bucks County bankrupty client today who had tried "debt settlement".  I Googled the company's name and included "scam" in the search.  The first result was intriguing.

What is completely buried in the Terms of Agreement with the debt settlement company, which is highly unlikely to be slowly, and exhaustively, explained to the client is that debt settlement is that settled or forgiven debt is taxable.  But, discharged debt in a bankruptcy is not taxable.

So, not only does debt settlement not work, but you get hit with a tax bill at the end.

Sunday, September 8, 2013

This makes me sick

A Washington Post investigative article shows the despicable state of tax liens in Washington, D.C.  Specifically, people are losing their homes over small (~$2,500) tax liens.  A lot of the properties were in low-income areas and had elderly homeowners.

I read the article twice and saw no mention of bankruptcy.  A Chapter 13 bankruptcy could have stopped the sale of these homes.  For $281 (the filing fee), a person can be in a Chapter 13 for 5 years and spread the payments over that 60 months.  I know the community legal services in the country  are tapped beyond their capabilities (just like Legal Aid in Bucks County is cutting back), but this would have been a quick fix if a program existed.  If you are looking for a Bucks County bankruptcy attorneys to stop a tax lien sale, call me immediately.  I do not want to see your home lost.

Wednesday, September 4, 2013

I can't believe I'm linking to

Here's a first for the Bucks County Bankruptcy Blog -- I'm linking to  I'm not writing about the latest celebrity pregnancy, however.  I'm still writing about relevant issues relating to being a Bucks County Bankruptcy attorney.

It appears that Warren Sapp, former NFL superstar, had a "massive" collection of Nike shoes sold at auction pursuant to a Chapter 7 bankruptcy filing.

For those who don't know, when you file for Chapter 7 and have "excess assets", a Trustee can liquidate the assets.  If, for example, a person has a second home that is paid off, the Trustee could hire a realtor to

So, I have not read Warren Sapp's bankruptcy petition.  But what I guess happened was that he exceeded the debt limit on a Chapter 13 (reports say he was "millions in debt") and decided that he was willing to have some assets liquidated by the Trustee to satisfy some portion of the debt, while discharging the remaining "balance".  His attorneys told him that some of his assets that were "non-exempt" would be sold and he was willing to do that to have the vast majority of his debt discharged.

Now, if Mr. Sapp did not list these assets, he would be committing fraud and false pretense in a bankruptcy. You never want to do that as you are looking at significant jail time.