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Annual 1099-C Don’t Freak Out Reminder! Every year, we get panicked emails, phone calls, carrier pigeon messages from clients who filed for bankruptcy and then received a 1099-C in February when tax forms start coming out. Don’t panic. Here are the thoughts that are running through your head: What’s a 1099-C? A 1099-C is issued when a creditor cancels or forgives debt. For example, if you settle an account by paying $1,000 and the…
Yesterday (January 5, 2021), news websites reported the following two headlines: PANDEMIC SPURS MOST BANKRUPTCY FILINGS SINCE 2009The sky is falling, the sky is falling! BANKRUPTCY FILINGS HIT 35-YEAR LOW THANKS TO GOVERNMENT PANDEMIC AID Wait, what? I thought the sky was falling. How can both of these headlines be true? Because the reporters cherry-picked statistics to make the most sensational headlines. As far as business bankruptcies go, it’s true that bankruptcy filings were…
Living on credit is a day-to-day reality for millions of Americans.  Consumer debt in the United States totals $14.1 trillion — that’s $14,100,000, 000,000 – with the average person owing over $90,000 (according to Experian’s 2019 Consumer Debt Study).  This includes credit cards, consumer loans, secured loans on personal property (electronics, furniture, jewelry, etc.), car loans, mortgages, and student loans.  Given that many people are living paycheck-to-paycheck and the job insecurity caused by the…
With the stroke of a pen, California’s homestead exemption — the amount of equity in one’s primary residence that can be protected from creditors — increased from $75,000, $100,000, or $175,000 (depending on the circumstances) to the greater of $300,000 or “the countywide median sale price of a single family home in the calendar year prior to the calendar year in which the judgment debtor claims the exemption,” up to $600,000. Put simply, the…
You may have read headlines recently such as “Court Allows Bankruptcy Discharge of $200,000 in Student Loans” and thought now is the time for file bankruptcy and get rid of your student loans.  Unfortunately, headlines can be deceiving.  In McDaniel v. Navient Solutions, LLC, the Tenth Circuit Court of Appeals affirmed the bankruptcy court’s ruling denying Navient’s motion to dismiss the borrower’s  complaint to discharge $200,000 in private loans.  The default rule in bankruptcy…
I always say that one of the most frequent sayings I hear is, “I didn’t know…” and it happened again on Friday. I was reminded this week that people may not realize how we help individuals and business owners with debt and credit strategy (or maybe what that means). A networking partner reached out to me to ask when I would get involved with a business that has not been able to operate due to…
The CARES Act, passed on March 27, 2020, kicked off a chaotic and unorganized process of applying for a new program called the Paycheck Protection Program. On the surface, this looked like a great program for struggling businesses. A loan that can be forgiven if used to pay employees, rent, and other approved business expenses. This idea was far better than saddling small businesses with more debt than they already have. The initial problem was…
Lots of information out there about the new CARES Act and what it purports to do. It’s a huge document and has a lot of moving parts. In an attempt to pull out useful information for the average consumer and small business owner, we are working on a series of blog posts to help answer some questions.  One of the most interesting sections discusses a new loan program for small businesses that has an element…
Lots of information out there about the new CARES Act and what it purports to do. It’s a huge document and has a lot of moving parts. In an attempt to pull out useful information for the average consumer and small business owner, we are working on a series of blog posts to help answer some questions.  The CARES Act has some specific protections for debtors in Chapter 13. For background, a Chapter 13 bankruptcy…
Lots of information out there about the new CARES Act and what it purports to do. It’s a huge document and has a lot of moving parts. In an attempt to pull out useful information for the average consumer and small business owner, we are working on a series of blog posts to help answer some questions.  Student loans are discussed in § 3513 of the bill and there is some relief available, provided your…