TheFloridaBankruptcyLawBlog

Inherited IRA Now Fully Exempt In Florida By New Statute

06/07/11

I wrote blog posts in this blog and on my asset protection blog about  Florida court decision finding that a debtor’s IRA inherited from another family member, excluding spouses’ rollover, was not exempt from the debtor’s creditors because the IRA represented an inheritance rather

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Best Way For Chapter 7 Bankruptcy Debtor To List His Interest In His Insolvent Business

06/03/11

Many self-employed debtors file bankruptcy because they have personally guaranteed debt of their failing business. Some of these debtors want to discharge their guarantees of business bank loans or credit cards used for the business, and they want to try to resurrect the business after they have been cleared of personal liability. In such cases, the debtor has to value his interest in the business. The debtor must value his stock, membership interest, or other form of ownership in his business.

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Bankruptcy Court Says Debtor Can Claim Wildcard Exemption Where Debtor Intends To Retain Upside Down House

05/30/11

Since the Florida Supreme Court liberalized the application of  the $4,000 wildcard exemption in February, 2011. The Supreme Court said that the wildcard exemption can be stacked upon the Constitutional exemptions for personal property and automobiles for any debtor who does not claim the homestead exemption in bankruptcy and where the homestead exemption does not otherwise impede the trustees administration of the bankruptcy estate.

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Banned From Bankruptcy Court: Judge Tells KEL Lawyers To Get Lost

05/23/11

Kaufman, Englett and Lynd, PLLC (“KEL”) is a law firm that advertises mortgage foreclosure defense work, among other things. KEL decided to get into the bankruptcy business and is one of the largest volume filers of bankruptcy petitions in the Middle District of Florida. I assume that many of KEL’s clients who could not pay their mortgage are also good candidates for bankruptcy to both protect themselves from deficiency judgments and wipe out other debts related to their financial hardship.

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Improving Means Test Results By Incurring Car Debt

05/19/11

When a debtor calculates a Chapter 7 means test analysis he is entitled to deduct from income transportation expenses associated with ownership of a car. All Florida debtors can deduct from income a general transportation expense which is approximately $250. There is another deduction associated with the expense of owning a car known as the “ownership expense.” The ownership expense is calculated using the debtor’s car payment and a fixed allowance of about $500.

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Chapter 7 Discharge Of Attorney Fee Sanctions From Divorce Proceeding

05/14/11

One of my Chapter 7 bankruptcy clients wants to discharge a judgment in favor of his former wife’s attorney. A family law judge issued a judgment for sanctions against my client  for frivolous litigation during a dispute over enforcement of a property settlement. The judgment was issued in favor of the ex-wife’s attorney for his attorney fees defending my clients continued and baseless challenges to the ex-wife’s enforcement of the property settlement.

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Does Parent's Chapter 13 Expense Schedule Include His Monthly Payments For Child's Car?

05/09/11

Here’s a relatively simple, but common,  question I was asked by email this past week. The writer makes payments on his daughter’s car titled in his daughter’s name. The writer (the parent) wants to file Chapter 13 bankruptcy and asks whether his monthly payment for his daughter’s car can be included in his expenses so as to reduce the amount of his monthly Chapter 13 plan payment.

The answer depends upon whether the parent signed the loan.

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Chapter 13 Success Enhanced With Voluntary Automatic Wage Deduction Payments

04/25/11

Most Chapter 13 bankruptcies fail. Most debtors do not pay their required payments to the Chapter 13 trustee throughout the term of their plan, and when payments fall behind their bankruptcy is dismissed without a discharge. It takes financial discipline to consistently budget money for Chapter 13 plan payments.

Chapter 13 success is greatly increased when the debtors pay the trustee through automatic wage deductions so that the debtor’s employer deducts the  required plan payment from the debtor’s pay check.

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Debtors Strip Their Second Mortgage Without Having To File Chapter 13 Bankruptcy

04/21/11

Some people with minimal credit card debt file Chapter 13 bankruptcy primarily to strip a second mortgage. You may be able to accomplish the same result without filing bankruptcy now that banks are becoming somewhat more flexible to work out mortgage solutions on upside down property. I’ve heard of cases where a second mortgage company will substantially reduce a second mortgage balance and permit the debtor to pay off the settlement amount in installments. Here is one real example.

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Joint Debtors Can Stack Their Chapter 13 Debt Ceilings In Some Cases

04/15/11

Many people who wanted to file Chapter 13 found that they were ineligible because their debts exceeded the Chapter 13 debt limits of approximately $1 million of secured debt or approximately $360,000 of unsecured debt. The debt limits have affected more people in the past few years because inflated real estate values during the boom resulted in many debtors having large mortgages which exceeded the secured debt ceiling.

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