Valencia Chapter 7 Bankruptcy Lawyer

Is Filing For Chapter 7 Bankruptcy Right for Me?

Chapter 7 is one of several bankruptcy options that caters to individuals with a specific set of financial circumstances. At Financial Recovery Law, we have assisted thousands of people in their bankruptcy cases since our establishment in 2001, including those filing for Chapter 7 bankruptcy. We take our clients through each stage of the process, providing them with advice and guidance in an effort to increase their chances of a successful filing. If you are interested in receiving in-depth information regarding the Chapter 7 process, contact a Chapter 7 bankruptcy attorney at our Valencia office who can provide you with the answers you need.

Bankruptcy - Chapter 7 Process

What is chapter 7 bankruptcy? Chapter 7 bankruptcy is aimed to serve the needs of those who are struggling with unmanageable debt, but who do not own assets that require protection from creditors. A person who files for Chapter 7 generally has their debts cancelled in a relatively brief period of time, with the assets they do possess being sold in order to provide funding for the repayment of their creditors. As the person does not possess large assets that they are reluctant to part from, the liquidation process is typically easier than it might be for someone who owns many valuable assets.

How to File Bankruptcy - Chapter 7

If you are struggling with debt, filing for Chapter 7 bankruptcy might help. Below is a timeline of how the Chapter 7 process works. In mostly involves attending mandatory counseling courses, meets, and filing documents on time.

Below are the typical steps to a Chapter 7 bankruptcy:

1. Before you file for Chapter 7, you must attend a credit counseling course. This is mandatory, but at the very least can be completed online or by phone.
2. File for bankruptcy. You may find the forms online. Be sure to include information about all your property and creditors, and provide information about all the financial transactions you have had during the last 2 years.
3. Send a copy of your most recent tax return to the bankruptcy trustee via mail. The bankruptcy trustee handles bankruptcy cases for the court. If they request supplementary documentation from you, you must provide it.
4. 30 days after filing, you must attend a creditor’s meeting. It usually lasts for 50 minutes and is conducted by the trustee. The creditors may or may not appear, however, it is very rare. During the meeting, you must answer (under oath) any questions from the trustee regarding your documentation or anything else they may find relevant to your case.
5. No later than 60 days of the creditor’s meeting, you must attend a budget counseling online or via phone. This is mandatory. Afterward, file a form and a copy of your certificate of completion with the bankruptcy court so there is a record of it and they can confirm it was done.
6. Finally, do not sell or give away any property. After 60 - 75 days of the creditors’ meeting, you should get a letter from the bankruptcy court that discharges your debts. The trustee will then arrange a time with you to liquidate your nonexempt property (if you have any). Be aware that during this period, creditors are still able to object to you discharging your debt.

Can IRS Debt Be Discharged in Chapter 7

Some IRS debts are able to be discharged in Chapter 7 bankruptcy. Dischargeable tax debts include income taxes that are more than three years old and do not involve fraud or willful evasion of payment. Additionally, if the debt is associated with a return that was due more than two years before filing for bankruptcy, it might also become dischargeable.

However, it is important to note that not all IRS debts can be discharged in Chapter 7 bankruptcy. For example, if you are filing for bankruptcy due to a tax debt, you must meet certain criteria: the debt must have been assessed by the IRS more than 240 days before filing and none of the taxes have been paid within three years prior to filing. Additionally, any tax debt related to fraud or willful evasion of payment is not eligible for discharge.

How Long Does Chapter 7 Bankruptcy Stay on Your Credit Report

You do not have to initiate the removal of a Chapter 7 bankruptcy from your credit report; it is usually performed automatically 10 years after the filing date. It is longer than Chapter 13 by 3 years because Chapter 13 typically requires you to pay back at least part of your debt.

Legal Assistance for Your Bankruptcy Case in Valencia

While the Chapter 7 process can be extremely beneficial for someone in financial trouble, its various steps can also be very complex, resulting in confusion for those not familiar with bankruptcy law. Many individuals who have attempted to file for Chapter 7 on their own have ended up in worse financial shape than they were in before they filed. Hiring an attorney can help one avoid this, as an attorney can spearhead the filing process on one's behalf, and help in avoiding the various difficulties that might otherwise cause one further problems.