Tag Archives: Chicago bankruptcy attorney

Hospitals Sue Patients for Unpaid Medical Bills: How Bankruptcy Protects You

Hospitals Sue Patients for Unpaid Medical Bills: What You Can Do

Hospitals are filing lawsuits against more of their patients. As collection agencies are less effective in collecting unpaid medical bills, hospitals sue patients with unpaid medical bills when they chose to collect from patients directly, instead of using a collection agency.

People incorrectly assume medical bills don’t matter and hope they do not get sued. Many large hospitals have a billing department that spends a calculated amount of time trying to collect a medical bill before sending it off to collections. Many collection agencies just call and harass you. Others threaten to sue.

Meanwhile, some hospitals sue patients for unpaid medical bills instead of waiting for the collection agencies to try collecting the balance due. Bankruptcy can stop the lawsuit!

Chicago Bankruptcy Lawyer Joseph Wrobel Can Help You Today at (312) 781-0996

News Article: Lawsuits From Nonprofit Hospitals That Trap Them in Debt

A struggling social worker, the former patient is being sued by a nonprofit healthcare network in Memphis, Tennessee. Her name is Raquel Nelson and she was sued for $2,200 by Methodist Le Bonheur Healthcare. Raquel isn’t the only one being sued, there are more than 8,300 lawsuits filed against patients for unpaid medical bills over five years.

If you think a hospital won’t sue you unless the amount is large enough, talk to Raquel Nelson or one the other 8,300 defendants with court dates. Most defendants sued for medical debts cannot afford a civil lawyer to defend them. Most defendants end up with a money judgment entered against them and a wage garnishment filed with the court and served on their employer’s payroll department.

You can stop lawsuits by hospitals with the protection of Bankruptcy Laws. For example, the Automatic Stay provision is a law that prohibits a creditor or collector from continuing any collection activity. A bankruptcy filing will also stop a wage garnishment. The money judgment entered against you in court can even be eliminated through a bankruptcy discharge.

Chicago Bankruptcy Lawyer Joseph Wrobel can help you today when you dial (312) 781-0996.

Bad Things Happen to Good People: Bankruptcy Laws Can Stop Lawsuits When Hospitals Sue Patients

Car accidents involving uninsured and underinsured motorists can leave injured victims high and dry, with no money to pay medical bills. Especially when your injuries are severe and you required surgery and rehabilitative care, the hospital bills can be tens of thousands of dollars.

Job losses and layoffs affect people’s budget and ability to make payments on medical bills. Plenty of people with medical debt can prevent collection activities by negotiating a monthly payment amount people can afford. If something happens that affects the ability to pay, like a job loss or layoff, you might end up getting sued by the hospital.

Why Collection Agencies Are Ineffective at Getting Hospitals Paid

Hospitals don’t write off as many bills as you may think. Check out this Modern Healthcare article, A Closer Look at Hospital Write-Offs.

A collector does not pose much of a threat if all they are going to do is continue harassing you. Collection agencies must follow debt collection practice laws. These are federal laws with serious penalties. More people are reporting bill collectors to the federal agencies who police them. As a result, collection agencies are changing their practice and might be less effective and hospitals are avoiding them and directly collecting and filing lawsuits.

Read Our Blog: How the FDCPA and the Automatic Stay Help Stop Bill Collectors From Harassing You

Chapter 7 Bankruptcy Can Help You Discharge Medical Bills with a Chicago Bankruptcy Lawyer

When most people think about a bankruptcy case they are looking for Chapter 7 Bankruptcy.  Chapter 7 requires you to qualify. If, for example, your income is more than allowed in Chapter 7, you can file a Chapter 13 bankruptcy.

If you are being sued or your wages are being garnished, you can stop the lawsuit and a wage garnishment with a Chapter 7 Bankruptcy and its Automatic Stay, stopping creditors and collectors in their tracks.

Chapter 13 Bankruptcy Can Help You Repay a Portion of Your Medical Bills Over Years and Chicago Bankruptcy Lawyer Joseph Wrobel can help You Today

Chapter 13 is the bankruptcy plan where you repay a portion of your debts over a three to five year period. In Chapter 13, you are allowed to keep your house, car, and personal possessions that might otherwise need to be sold or liquidated in a traditional Chapter 7 Bankruptcy.

Just like Chapter 7 Bankruptcy, a lawsuit, money judgment, and wage garnishment will also be stopped by the Automatic Stay when you file a Chapter 13 Bankruptcy. Call Joseph Wrobel, your Chicago Bankruptcy Lawyer (312) 781-0996.

Read Some Words from Happy Clients who Hired Joseph Wrobel for a Fresh New Start

“We hired Joseph Wrobel during one of the worst times in our lives…Bankruptcy. He was very knowledgable and honest. He responded to emails immediately, answered every question we had, no matter how small and always made us feel at ease. From the very first meeting with him until the end of our bankruptcy case, we knew we could depend on him. We’re very thankful for his expertise and would highly recommend him to anyone out there looking for legal assistance.” Scott and Lisa (2013)

Click for more -> Testimonials for Chicago Bankruptcy Lawyer Joseph Wrobel (312) 781-0996

When hospitals sue patients for unpaid medical bills, Joseph Wrobel can help!

Beware of Scams on Facebook Marketplace: Tips to Protect Yourself and Others

Example and Video from a Scammed Mother Shopping for a Television on Facebook Marketplace

Watch the video: Avoiding Facebook Marketplace Scams

“It Wasn’t Worth it,” said the woman who lost $250 to a scammer on Facebook Marketplace. The seller had a 65 inch smart TV for sale for $250. The buyer got the tip from a friend who said they recognized the seller on Marketplace as a high school friend. The seller acted with urgency, asking the buyer to send her the money using Venmo, a mobile payment service owned by PayPal. “There was a need to act fast.”

After the buyer sent the money, the excuses started rolling in. The buyer was not able to get the television. After many days passed, thy buyer asked for a refund. The seller said the money was already spent on bills.

Law enforcement says that if it sounds like it is too good to be true, it probably is. And if you are suspicious of anyone selling an online item, move along to the next seller.

Chicago Bankruptcy Lawyer Joseph Wrobel Can Help You Today at (312) 781-0996

Joseph Wrobel Attorney At Law

Security Concerns when Buying from Any Online Marketplace

There are several ways a con may try to get your personal information. From giving information about yourself in conversation to giving out your email or phone number, you may be giving more clues to someone than you expect. People may prefer to communicate through Facebook Messenger or a similar program instead of giving email or phone numbers that can be Googled for more information about you.

By sticking with a messenger program you know and trust, you can block anyone who seems up to no good or with whom you no longer want to communicate.

CNN Tips: 10 ways to stay safe when buying and selling online

Never Meet at Your Home or Workplace, Always Meet in Public

When buying or selling with someone you don’t know, use a designated public meeting place that is well lit, where there will be other people and security cameras. Call your local police or fire station and ask them if they know of any recommended spots to meet up with Facebook Marketplace buyers and sellers.

After you leave, make sure you are not followed home. Sophisticated crooks may use more than one vehicle and as one is leaving, the other is following you. It’s always good to vary your route home or make another stop somewhere safe and keep an eye open to make sure you were not followed.

Exchange Cash for Goods at the Same Time

Do not give someone your item and allow them to make payments later because the likelihood is they will never pay you. This is a common scam. Also, don’t fall for the “check in the mail” bit because it is usually a con.

Is the cash counterfeit? Is their check any good? How about cash? What about a bank check? Consider your comfort level in receiving secure payment in your transaction. If you are comfortable using a mobile payment method, do it on-site and give the person the item once you have received confirmation you received the money free and clear.

Does Something Seem Not Right About Your Buyer or Seller?

Especially when people say they are in the middle of moving to our out of state, be on alert for scammers. While there are many honest people who do buy and sell things like couches and televisions while moving, this is a perfect story to spin to a scam victim.

When using Facebook Marketplace you can view the person’s profile. You may have to add them as a Facebook friend to see more detail. Try asking if you don’t mind adding them as a friend before setting up the sale. Look for the same red flags you would if you received a friend request with someone who has no friends, has a brand new profile, or something else just does not seem right.

Know What You are Buying or Selling and What it is Worth

You may see someone selling a vehicle on Facebook Messenger telling you they just moved into the city and no longer need it, or need to raise money to pay for a court fine or child support. Beware, even though people may need to buy or sell quickly, they usually do not buy or sell things way over or under fair market value.

Do some research and look up what similar items are worth on various sites, including Craigslist, where you should also beware of shady buyers and sellers.

Great website – the nest – Read: How to Determine Fair Market Value of Household Items

Do Not Assume Other People’s Payments on Financed Items, Vehicles, or Property

What if you just got a new job and need a different vehicle to get to work. Maybe your credit is on the rebound and the car dealerships can’t help you. While it may be tempting to agree to take over another person’s payments on something, you should be very careful. Without understanding contract laws and remedies, you could end up getting in trouble. You might accidentally enter into a contract to receive stolen goods.

Here’s the link to search for “scam” and find related blog articles on our website, ChicagoBankruptcy.com

With too many scary examples to list, we recommend you stop and call Joseph Wrobel and talk to him about a concern that something may be a scam. Please also share this information with your friends and family who might be too trusting and need some street-smart tips on safety when buying and selling on Facebook Marketplace or anywhere else online.

Chicago Bankruptcy Attorney, Joseph Wrobel Wants You to Be a Safe Consumer

While our law firm is focused on bankruptcy protection, that is only part of our mission. We want everyone who knows us to come to us for tips and advice on buying, selling and making the best financial decisions for a bright and prosperous life.

For answers to any bankruptcy or consumer financial questions, call us at Joseph Wrobel, Ltd. at (312) 781-0996 and please remember to share this article with others and be smart buying and selling on Facebook Marketplace.

500 Jobs Cut: May Need Career Retraining After Job Cuts and Bankruptcy May Be a Great Option

500 Jobs Cut: May Need Career Retraining After Job Cuts and Bankruptcy May Be a Great Option

News reports say nearly 500 employees in the Chicago-area working for MB Financial Bank will be out of a job soon. The MB Financial job cuts are happening because Fifth Third Bank recently acquired MB Financial Bank in a $4.7 billion merger. 493 layoffs are expected in May, most of the job cuts taking place at the MB Financial location in Rosemont, and about a dozen in the downtown Chicago MB corporate headquarters. For many reasons some of the people who lose their jobs with MB Financial will need career retraining after job cuts.

A bank spokesman reported that most of the layoffs are coming in the next four months and others will occur over time through the rest of 2019 and 2020. The reason for the job cuts is a cost savings of $255 million, in part from closing one in five bank branch locations.

Chicago Bankruptcy Lawyer Joseph Wrobel Can Help You Today at (312) 781-0996 

Trends we can follow after job cuts are announced indicate that more customer service jobs are going away because of the Internet and automation technology. If automated telephone answering software can understand you and help with basic account information and customer service, there is less need for a customer service representative. Likewise, if more people can get their banking information and handle basic transactions on their computers, handheld devices, and ATMs, the need for human customer service professionals decreases.

Could You Pay the Bills While Looking for a New Job?

The recent US Government Shutdowns were shocking to many people because they were unable to pay their rent, mortgages, credit cards, and utilities. Even though the federal employees temporarily laid off from their non-essential government positions were going to receive back pay, their cash flow was interrupted.

Could you pay the bills if you suddenly had to live without getting a paycheck on time? You may be able to get away with only paying the minimum due amounts on credit cards, and getting a month behind on utilities, but most likely you cannot get along too long without substantial savings.

Many of the workers affected by shutdowns waited for the government to reopen, and others immediately started looking for a new job. If you cannot pay the bills after a job cut you might be facing evictions, foreclosures, credit account default, and the shutoff of utilities.

Read our article about this problem: Bankruptcy for Unpaid Workers

Bankruptcy Protection: Chapter 13 Reorganization

There are two types of bankruptcy protection available to consumers with debts they cannot pay. First, Chapter 7 Bankruptcy helps to wipe out and discharge the responsibility to pay dischargeable debts. Note that not all debts are dischargeable. For example, child support is not a debt you can discharge in a bankruptcy case.

Second, a Chapter 13 Bankruptcy is referred to as a wage earner’s plan. People with regular income can use Chapter 13 to develop a plan to repay a portion of their debts over a three to five year period. The problem workers facing job cuts may face is not having the regular income to qualify for a Chapter 13 Bankruptcy, also referred to as a “reorganization” bankruptcy. It is important to talk to an experienced bankruptcy attorney to learn how you can qualify for either Chapter 7 or Chapter 13.

When you contact Joseph Wrobel, Limited at (312) 781-0996 you can share more information about your financial circumstances and get a better idea which bankruptcy laws you can take advantage of to help get you out of debt.

Stop the Bill Collectors with the Automatic Stay

One of the most exciting advantages of a bankruptcy filing is the Automatic Stay provision that stops collectors in their tracks. Simply put, when someone files for bankruptcy, creditors may no longer pursue any collection activity. Therefore, during the bankruptcy case, whether you have a Chapter 7 or a Chapter 13, the bill collectors cannot communicate with you at all. No more phone calls, no more threatening letters.

The immediate ceasing of collection activity is just the first benefit of bankruptcy that many people can enjoy. Too often when people think about bankruptcy, they imagine companies going out of business and empty buildings. For consumers, bankruptcy is a right and a law designed to give people a fresh start, a chance to get back in control of money and finances.

Most people who file for bankruptcy will tell you that the anticipation of filing for bankruptcy was more stressful than actually moving forward and filing for Chapter 7 or 13. You may have a variety of questions about job cuts and bankruptcy.

Job Retraining Programs, Online, and Trade School Options

The chances are that some of the MB Financial employees losing their jobs are going to need career retraining after job cuts so they can get a new position, in a new career track. Workers in positions being reduced or replaced by technology and automation can change directions and pursue retraining for new positions that will be in demand and not in immediate danger of being cut.

When looking into career retraining options, consider some of the following steps you can take to make more money and increase job security:

  • Take a class to explore a new career field, to update a specific job skill or learn a new skill to make you more appealing to employers. By taking a class after being out of school for years, you show employers that you are flexible and interested in learning new skills.
  • Short-term training for new jobs is something you can pursue through certification programs, and certificate programs at local schools.
  • Begin a degree program and switch careers. You can plan your education and enroll in a degree program using financial aid tools which can also help pay for living expenses while pursuing higher education. Job cuts can be a disguised blessing.

Getting Financially Fit with Joseph Wrobel, Limited, the Chicago Bankruptcy Law Firm (312) 781-0996.

Even with bad news of job cuts, there are good opportunities behind the scenes. Some who wish for a higher paying job or career with more opportunities may get their wish in a job cut situation. The nearly 500 employees at MB Financial Bank can take advantage of one of their bankruptcy options while also pursuing retraining opportunities. To learn about bankruptcy or get some tips and leads on career retraining after job cuts, call Joseph Wrobel, Limited in Chicago at (312) 871-0996.

New Credit Reporting Rules: Many may find relief from reports of tax liens and civil judgments

New rules provide credit score relief for some people who have tax liens and civil money judgments against them. Errors on consumer credit reports have been a problem for a long time and many people have incorrect information on their credit reports. New credit reporting rules take effect July 1 and change the way Trans Union, Experian and Equifax verify data regarding the reporting of tax liens and civil judgments. Now, the three credit reporting agencies must verify the individual’s name, address and either social security number or date of birth. Since so many companies omit social security numbers for privacy concerns, there may be a large group of people who will no longer have tax liens and civil judgements appearing on their credit reports. This should also help prevent future instances of information appearing on the wrong person’s credit report.

The purpose of credit reporting and monitoring

From applying for a cell phone account or utility to buying a car or home, our credit rating is used to determine where we stand on the scale of credit risk. With great credit, we present a low risk of not making our payments in full and on time. The volume of credit data and computer systems processing and sharing information open the door to error. If we do not check our credit scores frequently, someone else’s negative information could prevent you from being accepted for a mortgage loan or a new credit card. Imagine finding out your credit score was damaged by another person’s tax lien or the civil judgement entered against them.

How errors happen and how prevalent they may be

With tax liens alone, some estimates suggest that half of the tax lien information reported to the credit bureaus has ended up appearing on the wrong person’s credit report. When social security numbers are available to the individuals reporting tax liens, one missed number could cause the wrong person to receive a negative mark on their credit report.

Even if someone checks their credit frequently, or pays a few bucks every month for a credit monitoring service, the effort it can take to correct the mistake can be staggering.

How the new rules apply to tax liens and civil judgments

The rule change for reporting information to the credit bureaus about tax liens and civil judgements will require the verification of three pieces of vital information, the individual’s name, address, and either their social security number or date of birth.

By requiring three sets of identifying criteria be matched before receiving credit reporting data about tax liens and civil judgments, the likelihood of mismatches is significantly reduced.

The new rules take effect July 1. This article in USA Today has more information about the new rules and how they might apply to you.

About us: Joseph Wrobel, Ltd., works with clients to find out if they qualify for Chapter 7 or 13 bankruptcy, and their options and rights under the law. The firm will also advise and assist clients with questions and concerns about the collectors and their rights to pursue you.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

 

March 2017 Chicago Bankruptcy Question and Answer Podcast with Joseph Wrobel

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress. Click/tap here to listen to this podcast interview anytime.

Sample questions answered in this 30-minute show:

  • How can I keep my car when I file for Chapter 7 bankruptcy?
  • How can my bankruptcy come off my credit reports but still shows up in public record searches?
  • What happens to my house if I file bankruptcy and my name is on the deed but not the loan?
  • I surrendered my car in my bankruptcy but the finance company hasn’t picked it up, now what?
  • What does it mean if a creditor has written off debt that’s included in my Chapter 13 plan?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973, he earned a JD from DePaul University Law School.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

Visit our Chicago Bankruptcy website online for more about the firm or call for more information at (312) 781-0996 or e-mail at JosephWrobel@ChicagoBankruptcy.com.

Financial Fitness: Develop frugal habits to save money and live well

A wise parent tells their children, “It’s not how much money you can earn, what matters is how much you can save.” We can all remember the first time we started making more money and had discretionary spending power for the first time. Did you buy a new car, clothes you wanted or take a vacation? Did you start an IRA and start skimming off the top of your paycheck for a rainy day? Most of us spend money on things that make us feel good, and experts say we make most of our purchase decisions based on emotion and later we justify them with logic. While saving money and going without new things may not seem very exciting at first glance, the financial security that comes along with good habits is something that we can all use to not only protect us from loss, but also to propel ourselves into financial success in the future.

The best part of the following frugal life tips is that you do not have to change your lifestyle to save money and be ready for life’s curveballs.

10 ways to spend less and live well:

  1. Make a budget. If someone put you on the spot and asked how much of your monthly income you spend on food, transportation or entertainment, would you be able to answer the question? Many of us budget by spending until we run out of money and hope we can make it to the next paycheck. Some of us run low on money and buy out half the grocery store, and end up with more food than we need. It takes time and practice to make a budget and stick to it. Even if it takes a dozen tries, keep working on figuring out exactly how much we really need for monthly expenses and learning how much we really have to put away and save for the future.
  2. Use a grocery-shopping list. Those impulse buys are tempting! Food also looks better when you go to the grocery store on an empty stomach. Never go to the grocery store hungry because you are more likely to buy more than you need and everything looks good. Spending the time to make a grocery store list before you head to the market will help you buy what you really need and avoid coming home with too much produce that could spoil. Sticking to your grocery list is a good exercise in financial discipline.
  3. Get into the coupon game. Cutting coupons can be a fun game when you pretend each piece of paper is money. If you receive a newspaper, even a Sunday paper, full of coupons, flip through them, compare them to your grocery list, and see where you can save some money. Be careful however, and do not use the excuse of cost-savings to buy more than you need. Similarly, just because a jacket at the mall is 50 percent off, does not mean you need to buy it if you already have several good jackets at home.
  4. Buy cost-saving alternatives. We often buy the items we like and that which we are accustomed. If we look around and try new things, it is possible there are other options out there that cost less and are just as good. Take buying salmon, for example, a grocery store chain brand of frozen wild salmon can be just as tasty and healthy as the fresh salmon in the deli. If you can develop the habit of pulling a salmon steak from the freezer and defrosting it in the refrigerator overnight, your grocery store dollar is worth more money.
  5. Pack a lunch. If you spend money eating out for lunch every day, not only are you spending extra money, you also have less control over what you are eating. Saving money by bringing a lunch to work is a frugal win and can be healthier too. Forget the soggy sandwiches in a paper sack and invest in good containers and portable lunch items because you will save money quickly by bringing your lunch. By the way, this does not mean you have to be chained to your desk; find somewhere you enjoy to relax and enjoy your lunch-break.
  6. Buy used items. Plenty of folks buy used furniture on Craigslist and find great pieces while saving money. Buying used cars on eBay is another way to avoid the overhead of a retail store/dealer. When the alternative is to buy new from a store and put it on a credit card, gently used items can be twice as affordable. If you can save a decent down payment, consider an auto loan from a local credit union, buy a used car from a private party, and get more for your money.
  7. Shop and save on utilities. With the deregulation of electric companies, there is more competition on the marketplace than ever. There are several consumer websites helping consumers find the best deals on the utilities and services. Doing some research and making phone calls to the cable, Internet and television providers can lead to significant savings, even if it means changing providers.
  8. Make your own popcorn and get into Netflix. Going to the movies is fun, but it is also a habit, often an expensive one. For the price of a small box of popcorn at most theatres, you can sign up for Netflix or a similar streaming video service, assuming you have the right technology to play Internet on your television. Buying popcorn at the grocery store and saving gas money and avoiding the high price of movie theatre tickets is a good way to save money and relax in the convenience of your home, which you probably spend good money keeping up.
  9. Host get-togethers with friends and family. Easy and affordable entertainment options include inviting people over to your home for a game, movie or simply social occasion. If you suggest your guests please bring either something to eat or drink you really do not have to spend much money, and your contribution is the use of your home and the effort to clean before and after. We do not need an expensive restaurant to enjoy one the good company of others.
  10. Set cost savings goals and reward your success. When you consciously work on these frugal financial success techniques, estimate the money you would have otherwise spent on the expensive alternatives. You might be surprised how much more you have and the fun times you enjoy on less money. Consider your success in savings and treat yourself to a night out at a new restaurant or go to a movie at the new theatre in town, and you may notice, when you do so less frequently, it is even more fun. Nevertheless, you also might want to treat yourself by taking the money you saved and invest it in your future!

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start.

Don’t forget to keep up with us on FacebookTwitterLinkedIn and Avvo, where you can read client and peer reviews!

Visit our Chicago Bankruptcy website online for more about the firm or call for more information at (312) 781-0996 or e-mail at JosephWrobel@ChicagoBankruptcy.com.

Chicago Bankruptcy Questions and Answers with Joseph Wrobel, December 2015

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress.

Sample questions answered in this 30-minute show – click here and listen anytime

  • Can I still file for Chapter 7 bankruptcy, even after I was served with a foreclosure complaint?
  • What is the pre-bankruptcy course, and why and when do I have to complete it?
  • Are there limits to the interest fees and charges I have to pay on credit card debt in Chapter 13?
  • How does reaffirmation work with loans for homes and vehicles when we want to keep them?
  • How will I be affected by my spouse’s bankruptcy filing, and do I also need to file with them?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973, he earned a JD from DePaul University Law School.

Don’t forget to keep up with us on Facebook, Twitter, LinkedIn and Avvo, where you can read client and peer reviews!

Visit our Chicago Bankruptcy website online for more about the firm or call for more information at (312) 781-0996 or e-mail at JosephWrobel@ChicagoBankruptcy.com.

Discharging qualified tax debt in Chapter 7 and 13 bankruptcies

Good people with bad income tax debt can discharge that tax debt in Chapter 7 and 13 bankruptcy cases if it is qualified tax debt according to the Internal Revenue Code. There are a large number of people who prepare their income tax returns every year and find out they owe the IRS. There may be payment plans the taxpayer can negotiate with the IRS when the money is not there to pay the tax bill. Despite the best-made payment plans, sometimes tax debtors cannot afford to make the scheduled payments. When tax debt is not paid, the IRS begins collection actions.

While W-2 wage earners have income taxes automatically withheld from their regular paychecks, the self-employed and small business owners are responsible for tracking their income and expenses and making estimated quarterly income tax payments. Problems such as recordkeeping errors or misplaced financial statements and receipts can delay the taxpayer from making their timely payments and some people miss IRS tax due dates, some eventually becoming years behind in filing and paying taxes. Tax penalties and interest are charged on tax debt every month.

The same work and income problems that lead to inability to pay mortgages, car loans and credit cards also affect people with tax debt they cannot pay. Bankruptcy Chapters 7 and 13 can solve a debt crisis.

Generally, tax debt is not dischargeable in bankruptcy, however, when five requirements are met, that qualified tax debt can be partially or fully wiped out or repaid over time.

  1. Income tax debt, interest and penalties may be dischargeable. Payroll tax and fraud penalties however are not dischargeable.
  2. Any income tax fraud or willful evasion will disqualify the tax debt from being dischargeable. Fraudulently using a false and social security number, for example, to evade paying taxes or purposely reporting less income than earned or deducting false expenses eliminates bankruptcy discharge eligibility.
  3. The income tax debt must be at least three years old to qualify for bankruptcy discharge. The tax return must have originally been due three or more years ago at the time of the bankruptcy filing.
  4. A tax return must have been filed for the income tax debt the bankruptcy filer wants to discharge. When returns are not filed, the IRS may record an estimated return. Even if the IRS seeks to collect tax debt on their estimated return, the debt is not dischargeable unless the taxpayer has filed an actual tax return.
  5. The 240-day rule is satisfied. To be dischargeable in bankruptcy court, the income tax debt must have been originally assessed at least 240 days prior to the filing for bankruptcy.

Even if a taxpayer’s income tax debt meets the five requirements for discharge in bankruptcy, a tax lien, placed on property, will not be extinguished, even if the underlying tax debt was forgiven in bankruptcy. Federal tax liens have to be paid before the property can be sold.

Assuming a taxpayer meets the five requirements to discharge income tax debt, the individual must qualify for either Chapter 7 or Chapter 13 bankruptcy. Chapter 7 (full discharge) requires the filer meet the income means test, determining if the individual’s income allows them to file for full discharge. The alternative is Chapter 13 (reorganization) which allows partial or full debts to be repaid over a three to five years, allowing the individual to catch up on debts over time.

Joseph Wrobel, Ltd. attorneys can help people by reviewing income and finances to determine whether they qualify for Chapter 7 or Chapter 13 bankruptcy. They can also review and advise on whether income tax debt, interest and penalties qualifies for discharge.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start. To keep in touch and read about consumer finance news and stories you can “Like” the firm’s Facebook page and “Follow” Joseph Wrobel. Ltd. on Twitter. If you need immediate legal assistance, please call Joseph Wrobel, Ltd. by calling (312) 781-0996 to talk to an attorney today.

 

Chicago bankruptcy questions and answers with Joseph Wrobel, September 2015

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress. 

Click/tap here to listen to the podcast now!

Topics covered in this 30 minute show:

  • What type of debts does a bankruptcy eliminate, and what debts will I have to keep?
  • How long does a debt need to exist to include it in my bankruptcy filing?
  • Are there any special rules in bankruptcy for home owners association dues?
  • How soon can I file for bankruptcy if I need to use the bankruptcy laws more than once?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973 he earned a JD from DePaul University Law School.

Visit our Chicago Bankruptcy website online for more about the firm. You may also contact Joseph Wrobel for more information at (312) 781-0996 and by e-mail at JosephWrobel@ChicagoBankruptcy.com

Bankruptcy Basics: August 2015, Real Questions, Real Answers with Joseph Wrobel

Chicago bankruptcy and consumer credit attorney Joseph Wrobel shares news and updates in bankruptcy law as well as business and consumer financial matters. It has been documented that financial troubles can cause all sorts of ailments, the most common of which is sleeplessness. Joseph Wrobel helps clients alleviate their anxiety created by the inability to pay bills and the embarrassment of financial distress.

Click/tap here to listen to the podcast now!

Topics covered in this 30 minute show:

  • How do I file for bankruptcy but also keep my home where I have a bad mortgage deal?
  • I had a bankruptcy 3 years ago and to date the bank has not taken my home, what do I do?
  • How can bankruptcy help me with medical bills I incurred when I didn’t have health insurance?
  • My husband might file for bankruptcy after the divorce, how do I protect my house?

Joseph Wrobel has been a practicing attorney since 1973 and has experience in a wide variety of law relating to legal matters for individuals and families. Wrobel helps clients get out of debt and get a fresh start. He is an active member in several bar associations and the Bankruptcy Panel of Pro Bono Program of the Chicago Volunteer Legal Services. After serving the U.S. Army Reserve 363rd Civil Affairs Unit, Wrobel earned a B.A. in Psychology from Northwestern University and in 1973 he earned a JD from DePaul University Law School.

Visit our Chicago Bankruptcy website online for more about the firm. You may also contact Joseph Wrobel for more information at (312) 781-0996 and by e-mail at JosephWrobel@ChicagoBankruptcy.com