While bankruptcy improves a person’s situation after financial disaster strikes, it is often filled with emotional, physical and financial ramifications. To reduce the stress of a bankruptcy filing, be sure to avoid these mistakes when working with Bankruptcy Lawyers in Tallassee AL.
Draining a Retirement Account
Retirement accounts are typically exempt from seizure during bankruptcy. Therefore, clients shouldn’t use the proceeds to pay bills before they file. If one must raid their retirement account to keep up, it may be time to consider bankruptcy as a more effective option.
Moving Too Fast or Too Slow
For most people, declaring bankruptcy is a difficult decision. However, if a client spends too long trying to find an alternative, they may make things worse. For instance, as creditors get ready to garnish a client’s wages, the stakes become higher. And, taking out a new secured loan will turn forgivable debt into something that puts a client’s car, home, and other assets at risk. Conversely, it’s crucial not to move too fast. Wait until the crisis passes, and all the bills are in before filing for bankruptcy.
Shifting Assets
It can be tempting to put assets in other people’s names so they can be omitted from a bankruptcy petition. However, doing so may lead to allegations of fraud. Property transfers may be reversed by a court-appointed trustee, causing extra difficulties for those receiving the assets. If there are legitimate reasons for the transfer of assets, Bankruptcy Lawyers in Tallassee AL can provide valuable advice.
Not Filing Taxes for Several Years
When clients are considering bankruptcy, they shouldn’t avoid filing taxes. The court-appointed trustee will check recent tax filings, and clients should do them before initiating proceedings if possible. If a client can’t pay all their past due taxes, they may have the option to make installment payments to the Internal Revenue Service.
Start Today
Bankruptcy isn’t a decision to be made lightly, but it can be beneficial in certain circumstances. When potential clients need to learn how the process works, they can consult the team at Courtney & Mann LLP by phone or online.
