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Two US Senators have introduced a bill called the Family Farmer Bankruptcy Tax Clarification Act of 2013 to reverse a 2012 US Supreme Court decision regarding family farmers in Chapter 12 bankruptcy. The senators state that the changes to the bankruptcy code in 2005 allowed farmers to first pay creditors and then the IRS; however, in Hall v. United States the Supreme Court ruled that farmers must first pay the IRS. The Senators argue that this ruling prevents farmers from reorganizing under … [Read more...]

The owner of the runaway train that killed 47 people in Canada has filed for bankruptcy relief in both Canada and the United States after pressure to pay for the costs of the cleanup from the tragic accident. To date, over $7 million has been spent by the municipality where the accident occurred to clean up the oil that spilled during the crash. More costs and lawsuits are expected to be incurred by the company who said that revenues fell sharply after the derailment. For the full story … [Read more...]

In 2005 when Congress reformed the US Bankruptcy Code, they required debtors filing bankruptcy to take an approved pre-filing credit counseling class as well as a post-filing debtor education class. Companies that offer the classes must be approved by the US Trustee’s Office. The first course is designed to evaluate your financial situation and explore alternatives to bankruptcy. The second course educates debtors about budgets, managing money and credit. For more information about these … [Read more...]

Many experts thought that with the filing of the largest US municipal bankruptcy the municipal bonds market might take a hit. However, the $3.7 trillion US municipal bond market seems to be doing fine in the wake of Detroit’s bankruptcy filing. In fact, general obligation bonds have seemed safer to investors after Detroit’s bankruptcy filing even though some Michigan cities are having some trouble borrowing in light of the Detroit bankruptcy. For more read, “Detroit's Bankruptcy Doesn't Faze … [Read more...]

As part of the bankruptcy process, last week Christie’s, an international auction company, said that it would be apprising some of the works of art housed at the Detroit Institute of Arts. The museum has works of art by famous artists including Renoir and Van Gogh. If Detroit’s bankruptcy is approved, the works of art could be sold as part of the bankruptcy estate to pay the city’s debts. Even though the city manager states there is no plan to sell the art, the valuation is part of the … [Read more...]

Bankruptcy petition preparers are beginning to crop up again and target the poor or those who believe they can get a deal by using a petition preparer rather than a qualified bankruptcy attorney. In the Eastern District of Wisconsin, one bankruptcy judge fined a petition preparer and ordered him to refund fees stating he caused clients “more trouble” by the work he performed. The judge also referred the case to the US District Court. Petition preparers often have little to no experience and can … [Read more...]

There are times when it may benefit you to second guess getting a mortgage loan even if you feel you are ready to purchase a home or another piece of real estate. If you debt is too high, it will hurt your chances of obtaining credit or may lower the amount of credit you can obtain. Likewise, if your income is too low you may not be able to qualify for the mortgage amount needed to purchase the home you desire. You may need more time to pay off other debts or obtain a job making more money. … [Read more...]

Retirees are very worried about how they will be treated in the Detroit bankruptcy. Now that the bankruptcy court judge has granted retirees a spot on the creditors committee to represent the city’s retired employees, retiree associations are vying for those spots. A newly created retiree association, The Retired Detroit Police Members Association, was formed just five days prior to Detroit’s bankruptcy filing. That association seems to be overlapping with the Retired Detroit Police and Fire … [Read more...]

When Detroit filed the largest municipal bankruptcy in US history in July, the bankruptcy action stayed any legal action against the city as well as prevented any new legal actions from being filed against the city. This stay included property tax appeals for Detroit property owners. However, this week Bankruptcy Judge Steven Rhodes ruled that property owners within Detroit could file property tax appeals but could not collect on any decisions without prior approval from the court. To read … [Read more...]

Some people love their credit union to the point that they want to pursue that relationship after filing bankruptcy. However, there is an upside and more than just one downside to preserving your banking relationship with the credit union. One downside is a reaffirmation agreement that will give the credit union the right to sue you for any unpaid balance even after the bankruptcy. Having an attorney advise you of your rights regarding bankruptcy and credit unions is the best way to make an … [Read more...]