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Potential Risks of Bankruptcy When Using a Software Program

Many people use online tax software programs to file their taxes each year. These software programs are suitable in a pinch for a wide majority of people with standard sources of income, single-home families, spouses joint filing, and many others. However, these programs may not be effective when used to calculate tax returns for self-employed individuals or filers with complicated incomes.

 

Just as these tax programs aren’t perfect for everyone, online bankruptcy filing software programs can be a risky option if you plan to file without the help of a bankruptcy attorney. Improper filing can add to the risks of a bankruptcy and make a serious situation much worse, including the permanent/irreversible loss of your property. When you employ the expert services of Behm Law Group, Ltd. instead of using an online bankruptcy software filing program in Fairmont, MN, you can avoid these potentially disastrous risks.

 

Bankruptcy software programs are offered through some online providers, ranging in cost. These programs can be very dangerous for those with simple financial circumstances filing for Chapter 7 and especially for those filing for Chapter 13 or have more complicated circumstances.

 

The two most common misconceptions about bankruptcy filing software are that it’s cheaper, and that the program will be easier and will do most of the work for the filer.

 

While bankruptcy software may be less expensive upfront than hiring an attorney, that doesn’t mean it will save you money. In fact, filers using online bankruptcy filing software may lose a significant amount of money in the form of some debts not being discharged and property being lost. For many filers, typical bankruptcy software might not be able to predict all the debts that can be discharged in a Chapter 7. Debts like medical bills, credit debt, or some tax debts might be exempted from the discharge process, and you’ll still be obligated to pay them.

 

It’s a huge misunderstanding to believe that even the best bankruptcy filing software will do the lion’s share of work or will be easier than working with an experienced legal representative. Bankruptcy software programs still require you to complete all the necessary petition paperwork, generate a repayment plan proposal if you’re filing Chapter 13, enter proof of completion of both pre-bankruptcy and post-petition requirements, and overall organize and enter all the information needed to complete a case. A bankruptcy program will simply run calculations and give that information to the bankruptcy court.

 

In a nutshell, online bankruptcy software programs are poor middlemen between the filer and the bankruptcy court. They can’t offer anything close to the in-depth, reliable support system and skilled professionalism of a trained bankruptcy attorney. In addition, bankruptcy software programs may miscalculate your dischargeable debts, cause the loss of property you could otherwise exempt and keep, and may even cause your case to be dismissed due to inaccurate calculations or lack of information.

 

To learn more about filing with an attorney and the potential risks of online bankruptcy programs compared to the benefits of having an experienced bankruptcy attorney in Fairmont, MN, contact Behm Law Group, Ltd. today at (507) 387-7200 or stephen@mankatobankruptcy.com.

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Getting Through a Recession as a Small Business Owner with Debt Relief

There is no denying the impact the COVID-19 outbreak is having on the worldwide economy. As we all reel around a difficult financial time in this recession, many small business owners are asking how they can work through the devastating effects on the economy and come out on the other side as a still functioning operation. Many businesses may have even gone through the 2008 recession and found that there are some tricks to staying solvent. One option that’s always available to sole proprietorships and partnerships is debt relief through Chapter 13 bankruptcy. If you are struggling to meet debt payments in Pipestone, MN, during this time, Behm Law Group Ltd. can help you work through a Chapter 13 reorganization case to receive long-term debt relief that will likely support you to the end of this recession.

Even though we are at the beginning of what will likely be a long recession, it’s not too early to think about your options for debt relief, especially if you already have a difficult time meeting monthly financial requirements. While there are ways to protect your income and business operations during this time—protecting cash flow, limiting purchases, restricting your budget, and formatting marketing plans around the crisis—these actions are sometimes not enough. Many industries will be significantly impacted by the effects of the COVID-19 shutdowns, and amid such long-term desperation, filing for bankruptcy can be a rational, intelligent choice.

Chapter 13 bankruptcy can be filed if you or you and your business partner are personally responsible for business debts. This is often the case with small businesses because the cost of becoming incorporated typically outweighs the protection it provides. When you file for Chapter 13, your business debts and personal debts will be included together in a repayment plan lasting three to five years. This repayment plan will be overseen by a chapter 13 trustee and organized to fit your current financial situation.

If you are personally liable for your business debts, the only way you can keep that business running through a bankruptcy is to file Chapter 13. This process requires you to repay your priority and secured debts under adjusted terms that are more favorable to you.  Also, your unsecured debts will generally not receive any interest and will typically only be paid a percentage of what you owed when your case was filed. While some might consider filing for bankruptcy to be a dramatic decision, the fact is that Chapter 13 bankruptcy helped thousands of small businesses weather the 2008 recession and emerge with their businesses still intact. Thanks to the help of Chapter 13 repayment plans, small businesses can work through this difficult time just as successfully as in the 2008 recession.

You don’t have to be one of the many small businesses that will sadly have to close doors within the next few years due to the financial stress of the coronavirus. Resolve your debts with Behm Law Group Ltd. today. Contact us at (507) 387-7200 or stephen@mankatobankruptcy.com for more information about Chapter 13 debt relief in Pipestone, MN.

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Finding Business Debt Relief in the Aftermath of the COVID-19 Outbreak

Bankruptcy is not for everyone and anyone who practices bankruptcy law responsibly and ethically will not try to “sell” someone on the process.  It is appropriately viewed as a last resort.  It is not something to be afraid of but it needs to be approached with a degree of healthy respect.  There is, however, no denying the significant impact the COVID-19 outbreak is having on global, national, and local economies. With the dramatic rise and fall in demand of various goods and services, the temporary closure of many operations, travel bans, trade constriction, and the detriment of the virus itself, the economy may be looking at numbers even worse than the housing crisis of 2008.

Many economic experts projected from the beginning of March that businesses of all shapes and sizes would be impacted by the damages wrought during the COVID-19 outbreak. If you are a local business, you may not be alone if you’re considering filing bankruptcy to find debt relief. With the help of Behm Law Group, Ltd., you can find protection and long-term debt relief in Waseca, MN through Chapter 7 or Chapter 13 bankruptcy.

Whether you file for Chapter 7 or Chapter 13 will depend on several things. First, only sole proprietors or partnership companies in which the owners are personally responsible for business debt may file for Chapter 13 reorganization bankruptcy. The process of Chapter 13 bankruptcy restructures business and personal debts together into a manageable repayment plan lasting a three- to five-year period depending on your debt and income. If you qualify for Chapter 13, you can maintain business operations and slowly repay your debts on terms that are more favorable to you.

If you don’t qualify for Chapter 13 or if you can accept that your business may have to be closed down, you have the option to file for Chapter 7 bankruptcy.  This process will liquidate your non-exempt assets in exchange for the discharge of debts. While you might not be able to keep your business running, you will likely be able to protect and retain things like your home and car and other necessary assets from liquidation.  In chapter 7 bankruptcy, the exemptions allowing you to protect and retain assets are quite generous.  In the vast majority of cases, people are able to keep all of their assets and the only things that they lose are their debts.

A comprehensive outlining of what is happening to the economy throughout the COVID-19 outbreak was done by the Center for Strategic & International Studies (CSIS). This informational article describes the impact COVID-19 has had through the very beginnings of the global outbreak on the economy including the drop in exports out of China, the fall of tourism, the demand for sanitary products, and much more. If you’re seeing an impact on your business operations due to the coronavirus and trickle-down global effects, you’re walking a fine line with practically every other business in the world. Relief from that impact can be found in bankruptcy.

To learn more about finding debt relief in Waseca, MN through bankruptcy, contact Behm Law Group, Ltd. today at (507) 387-7200 or stephen@mankatobankruptcy.com.

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Chapter 12 Bankruptcy for Farmers Affected by COVID-19 Shutdowns

As we continue to move through the devastation of the novel coronavirus outbreak, more and more public gatherings and store fronts are closing down operations. While there are many business owners severely affected by this outbreak, farmers and fishers might be looking at even more long-term negative effects than any type of retail operations.

The COVID-19 outbreak has led to countless farmers’ markets, outdoor year-round markets, local groceries, and many other food sale outlets to be shut down. These closings are creating a serious deficit in family-owned farmer and fisher incomes. If you are struggling with these shutdowns as a family farmer or fisher, Behm Law Group Ltd. can help you find debt relief through Chapter 12 bankruptcy in Windom, MN.

Chapter 12 bankruptcy is a chapter of the bankruptcy code that is specifically designed for family-owned farming and fishing operations that are struggling to make debt payments from month to month. If at least 50% of your annual income is sourced from your farming/fishing operation, you can qualify for Chapter 12 bankruptcy relief.

As a reorganization type bankruptcy, Chapter 12 works to structure your debts into a manageable repayment plan that is suited to your income and through which the debts in your farming or fishing operations can be paid back under terms that are much more favorable to you than the loan terms you may have now. While maintaining fair treatment to your creditors, you can repay your debts under the supervision of a trustee with pre-determined monthly payments during a three- to five-year period.

With prices of farm goods already tipping many farmers and fishers to the point of dipping into their savings, the new blow that COVID-19 outbreaks have had on the global economy and the shutdown of many public markets puts local agriculturalists in a precarious position. Without a clear idea of how commerce will continue to move forward into the growing season, many farmers are unsure of how to plan for the coming months. If coronavirus shutdowns and bans against public gatherings continue in some areas, farmers and fishers may have to file for Chapter 12 bankruptcy relief or find other sources of income.

The additional uncertainty farmers have with the upcoming presidential election only adds more pressure to an already stressful situation. If you are a local farmer or fisher, and you find that your debts are piling up with no clear idea of how they will be resolved, you can turn to the relief provided in a Chapter 12 bankruptcy. Those filing for Chapter 12 are not alone, and many other farmers or fishers have found long-term debt relief through the process. Chapter 12 bankruptcy can provide the long-term relief that farmers and fishers need to constructively address overwhelming debt and stabilize their businesses.

If you are considering filing for Chapter 12 bankruptcy in Windom, MN, we can help. Contact Behm Law Group Ltd. at (507) 387-7200 or stephen@mankatobankruptcy.com for more information.

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Chapter 12 Bankruptcy for Farmers Affected by COVID-19 Shutdowns

As we continue to move through the devastation of the novel coronavirus outbreak, more and more public gatherings and store fronts are closing down operations. While there are many business owners severely affected by this outbreak, farmers and fishers might be looking at even more long-term negative effects than any type of retail operations.

 

The COVID-19 outbreak has led to countless farmers’ markets, outdoor year-round markets, local groceries, and many other food sale outlets to be shut down. These closings are creating a serious deficit in family-owned farmer and fisher incomes. If you are struggling with these shutdowns as a family farmer or fisher, Behm Law Group Ltd. can help you find debt relief through Chapter 12 bankruptcy in Windom, MN.

 

Chapter 12 bankruptcy is a chapter of the bankruptcy code that is specifically designed for family-owned farming and fishing operations that are struggling to make debt payments from month to month. If at least 50% of your annual income is sourced from your farming/fishing operation, you can qualify for Chapter 12 bankruptcy relief.

 

As a reorganization type bankruptcy, Chapter 12 works to structure your debts into a manageable repayment plan that is suited to your income and through which the debts in your farming or fishing operations can be paid back under terms that are much more favorable to you than the loan terms you may have now. While maintaining fair treatment to your creditors, you can repay your debts under the supervision of a trustee with pre-determined monthly payments during a three- to five-year period.

 

With prices of farm goods already tipping many farmers and fishers to the point of dipping into their savings, the new blow that COVID-19 outbreaks have had on the global economy and the shutdown of many public markets puts local agriculturalists in a precarious position. Without a clear idea of how commerce will continue to move forward into the growing season, many farmers are unsure of how to plan for the coming months. If coronavirus shutdowns and bans against public gatherings continue in some areas, farmers and fishers may have to file for Chapter 12 bankruptcy relief or find other sources of income.

 

The additional uncertainty farmers have with the upcoming presidential election only adds more pressure to an already stressful situation. If you are a local farmer or fisher, and you find that your debts are piling up with no clear idea of how they will be resolved, you can turn to the relief provided in a Chapter 12 bankruptcy. Those filing for Chapter 12 are not alone, and many other farmers or fishers have found long-term debt relief through the process. Chapter 12 bankruptcy can provide the long-term relief that farmers and fishers need to constructively address overwhelming debt and stabilize their businesses.

 

If you are considering filing for Chapter 12 bankruptcy in Windom, MN, we can help. Contact Behm Law Group Ltd. at (507) 387-7200 or stephen@mankatobankruptcy.com for more information.

 

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Understanding Why Some Tax Debts Are Excluded from Discharge in Bankruptcy

After tax season has come and gone, people with lingering tax debts may be wondering how to cope with repayment or they are searching for a source of relief from that debt. If you’re looking for relief from other debts on top of tax debts, you may be able to find positive, long-term relief through Chapter 7 bankruptcy. In many cases, income tax debts can be discharged if they are at least three years old and those tax debts have been assessed as being due and payable for at least two years. However, some types of tax debt cannot be discharged through the bankruptcy process. Depending on your tax debts, you may or may not be able to have them discharged in a Chapter 7 bankruptcy. With the help of Behm Law Group Ltd., you can determine if filing for chapter 7 bankruptcy in Mankato, MN, is right for you.

 

Chapter 7 bankruptcy works to discharge debts in exchange for the sale of non-exempt assets. Non-exempt assets are assets whose values exceed the applicable protective exemption amounts provided by the bankruptcy code.  However, tax debts can be complex and how they are treated in bankruptcy can be nuanced.

 

Generally speaking, the conditions for a tax debt to be discharged in bankruptcy are stringent. First, it must be an income tax type of debt.  Second, the debt must be at least three years old, and you must have filed the return for the tax year giving rise to the tax debt at least two years ago. Also, the tax debt must have been assessed (acknowledged as due and payable) by the taxing authority for at least 240 days before you file bankruptcy, and there must be no evidence that you have engaged in fraud or willful tax evasion. If the income tax debt meets these conditions, it can be considered hardship and proof that you were unable to pay that debt for reasons outside of your control and such tax debt can be discharged in a chapter 7 bankruptcy case.

 

Tax debts that are excluded from the bankruptcy process are typically non-dischargeable for good reason. Most of these debts directly impact another person, organization, business, or other third party.

 

With a few exceptions, the tax debts that will typically survive a chapter 7 bankruptcy case include:

 

  1. Property taxes: These affect your city, state, and federal government in many ways. Because property taxes typically impact a local government, they can have significant influences on housing costs, licensing, and other property requirements if they are left unpaid.  Usually, when a city or county is owed property taxes the city or county will be entitled to assert a secured lien against any subject real estate for the amount of the delinquent property tax debt.    For instance, if you owe $10,000.00 to a city for property taxes, the city will assert a secured lien against your home in the amount of $10,000.00.  Such liens are essentially like other secured liens, such as liens on motor vehicles.  In a chapter 7 bankruptcy proceeding, you could technically be relieved of such property tax debt but you would also have to surrender your house.  For example, presume that you own a house that is worth $100,000.00 and that there is a $90,000.00 secured mortgage on the home.  Presume further, that you are delinquent with property tax debt to the city in the amount of $10,000.00 and that the city has asserted a tax lien for that amount.  If you were to file for chapter 7 bankruptcy relief, both the $90,000.00 mortgage and the $10,000.00 property tax lien would be considered secured debts secured by the value of your home.  In a chapter 7 case, both the mortgage lender and the city would only have recourse/relief for such debts against the value of the house.  You could walk away from personal liability for those debts going forward but you also would have to accept that you would have to surrender or lose the home.
  2. Third-party taxes: These include taxes paid to trust fund parties such as FICA and Medicare. It also includes sales taxes paid to the debtor by customers.
  3. Tax liens: Some tax debts can be secured by a tax lien asserted by the Internal Revenue Service or the Minnesota Department of Revenue.  In this case, the lien filed by the taxing authority essentially becomes secured by pretty much everything you own, including 401(k) plans, IRA’s, checking/savings account deposits, furniture and appliances, etc.
  4. Employment taxes: These includes excise taxes and custom duties, depending on time periods.
  5. Tax return errors: If you were erroneously refunded more than you should have on a tax return, you owe that back as a debt to whatever government entity paid it to you. This can significantly affect local governments if you do not repay it.

 

If you are planning on filing for chapter 7 liquidation bankruptcy in Mankato, MN, and want to know how it will affect your tax debt, contact Behm Law Group Ltd. at (507) 387-7200 or stephen@mankatobankruptcy.com.