Filing for bankruptcy is a nuanced process that can be difficult without the assistance of an experienced bankruptcy attorney. No matter what type of bankruptcy you file for, the process can be greatly improved and filed without mistakes when you take advantage of the protection and guidance of a professional. Bankruptcy cases for individual consumers are typically formatted into Chapter 7 (non-exempt asset liquidation in exchange for debt discharge) or Chapter 13 (debt reorganization into a three- to five-year repayment plan). Both of these Chapters can be further complicated with the introduction of a bankruptcy audit. If you choose to file for bankruptcy, the help of a Behm Law Group Ltd. bankruptcy attorney in Owatonna, MN, can counsel and protect you in the face of an audit or any other legal hurdles you may face.
Bankruptcy audits are rare, but they are done routinely each year by the U.S. Trustee’s office, which can audit up to 1 in every 1,000 Chapter 7 and Chapter 13 cases and is required to audit a minimum of 1 in every 250 cases per district. The audits are randomly selected, but the office can also audit unusual cases based on an income or debt alert system.
In a bankruptcy audit, the Trustee’s office delegates an external auditing company to verify aspects of the case, including income, expenses, debts, and assets. You, as the filer, do not have to pay any fees in the audit, but you are required to provide copies of any requested financial documents.
The audit firm has 21 days to submit the audit report to the court, and the court uses that data to determine how the audit affects your case.
If your case is audited by random selection or based on the office’s alert system, a few outcomes can happen. If the court finds any issues in the audit with your case, you may have your case dismissed, your right to a discharge may be denied, or your case may be marked as fraudulent and criminal proceedings could be commenced if you have tried to use the process to hide assets. In most cases, if a bankruptcy filing is audited randomly, there are no issues and your petition continues through the court process normally and you get a discharge of your debts.
In some circumstances, filers may have made mistakes in their paperwork that appear fraudulent or must be remedied by reopening the case. With the support of a bankruptcy attorney, however, corrections can be made in the course of an audit and your case will not be dismissed and you will get a discharge of your debts. To file a case with integrity and receive long-term debt relief, contact Behm Law Group Ltd. at (507) 387-7200 or via email at stephen@mankatobankruptcy.com to get started with a bankruptcy attorney in Owatonna, MN, today.
