May 23, 2019

This is no April Fools’ Joke: Means Test Numbers are Going Up as of April 1, 2019!

After your initial consultation, I will analyze your financial circumstances and perform your Means Test. A Means Test is an assessment used to determine if you qualify to file a Chapter 7 Bankruptcy.

Before 2005 it was easy to file for bankruptcy; virtually anyone could do so. In 2005 Congress enacted the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA)1 and added the Means Test requirement to prevent abuse of the Bankruptcy process. Simply put if you “pass” the means test, you are a qualified candidate and can file a Chapter 7 Bankruptcy Petition. If you “fail” the means Test, you may not file a Chapter 7 Bankruptcy but you may enjoy other alternatives such as a Chapter 13 Bankruptcy.

The Means Test primarily encompasses a two-step analysis:

STEP ONE: Your (the “debtor’s”) gross income is calculated on an average over a six month period prior to filing for Bankruptcy. Gross income for means testing purposes includes wages, salary, tips, bonuses, overtime and commissions. It does not include social security benefits. The figure derived from taking the average is than considered the Debtor’s Current Monthly Income which is then compared to the median income for your state and household size. If your current monthly income is less than the median income for your state and household size, than you “pass” the means test and are allowed to file a Chapter 7 Bankruptcy Petition. If, however, your current monthly income is greater than the median income for your state and household size, you may proceed to Step Two.

STEP TWO: If your current monthly income is greater than the median income for your state and household size, there is, in technical terms, a “presumption of abuse.”2 In order to rebut the presumption, or in other terms, to pass the means test by using the second step, the means test’s second section allows you to subtract from your current monthly income certain allowable and deductible expenses.3 These allowed deductions include, but are not limited to, expenses for living (mortgages and property taxes), transportation (car loans and car taxes), health insurance and charitable donations. After the calculations are performed, and the allowable deductions are taken, and if you then have no disposable monthly income available, you will then have passed the Means Test and may file a Chapter 7 Bankruptcy. If, on the other hand, you do have remaining disposable income, you may consider a Chapter 13 Bankruptcy.

The discussion above is an overview of the Means Test in basic terms and is in no way intended as a specific analysis of your personal financial circumstances.

For an analysis of your own financial circumstances, please contact Attorney Theresa Rose DeGray, to schedule your free consultation today!

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1See: 11 U.S.C. § 707(b)

2See: 11 U.S.C. § 707(b)(2) and 11 U.S.C. § 707(b)(3)

3See: 11 U.S.C. § 707(b)(2)(A)

What to Expect at an Initial Consultation

THE FIRST STEP on your journey to a fresh start begins with a free and confidential consultation to learn exactly what your options are.  I offer initial consultations at various locations around the state of Connecticut (including Milford, Shelton and Wethersfield) and will strive to find a convenient time and place to meet with you.  I have day, evening and weekend appointments available and will even skype or facetime with you!

An initial consultation with a lawyer is a great opportunity for many reasons.  When you meet with me for the first time you will be treated with respect, dignity and compassion.  I understand the hardship you are facing and will give you my full attention.  The meeting will be an opportunity for you to interview me, just as much as it is an opportunity for me to interview you.  Always remember, when you hire an attorney, they work for you, and you must feel comfortable with them as you will have to trust your attorney to guide you through each and every step of the Bankruptcy process.

During our consultation I will ask pointed questions that are focused on painting a picture of your financial circumstances.  This inquiry will include questions pertaining to your income, assets and debts.  Through your answers I will be able to analyze your financial circumstances and offer you options.

Next I will show you various disclosure statements that I am required to give to you by the United States Bankruptcy Court under the Bankruptcy Code1.  These documents will explain the Bankruptcy process, the difference between the various chapters of Bankruptcy, what a Discharge is and what credit counseling services are, among other important things.  You will be asked to sign these documents, acknowledging that you received them.

Finally, if I determine that you are a likely candidate for Bankruptcy and you are interested in hiring me to file your Bankruptcy Petition, I will conclude my presentation by guiding you through a checklist of documents I will need from you to perform a Means Test.  A Means Test is a formal assessment used to determine if you qualify for Bankruptcy.  Do not be alarmed, it is not a test like the SATs and does not require you to pencil in any bubbles!  On the contrary, you will gather the documents and my staff and I will prepare the test for you as part of our package services.

Throughout the consultation and especially at the end, I will ask you if you have any questions.  I will be happy to answer all of your questions and you should not hesitate to ask any question or ask for clarification if something is unclear.

At the conclusion of the initial consultation I will give you a folder with all of my contact information and copies of all the documents you read and signed during the meeting.  A follow-up appointment will be made with you for either a telephone conference or an in-person meeting to go over any further questions you may have and to help you with the gathering of your documents.

The next part of this series will go into more depth about the specific documents you will gather so that we will be able to analyze your financial circumstances and prepare your Means Test.

To schedule your initial consultation, please call us at 203-713-8877 or visit our website at www.ConsumerLegalServicesLLC.com.
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111 U.S.C. §§ 101-1532

GOOD NEWS: Updated Census Bureau Median Family Income Data

March 14, 2019

The Census Bureau’s Median Family Income Data accessible through the “Means Testing Information” page has been updated. The U.S. Trustee Program will apply the updated data to all cases filed on or after April 1, 2019.

SOURCE: https://www.justice.gov/ust

Turn Your Tax Refund Into Debt Relief Today

“Leverage: the use of a small initial investment…to gain a very high return.”

— Dictionary.com

          I have been debating how to talk about this in a delicate manner and I simply could not figure it out. So, I will just come out and say it: People being crushed by debt can leverage their tax refunds to file Bankruptcy and get a Fresh Start. There, I finally said it.

          It may not sound kosher but it is. Instead of using your tax refund to pay off a portion of your debt, or to buy a big screen TV, people can pay for their legal fees to get out of massive amounts of debt if they qualify and it is the right thing for them to do based on their circumstances.

          If you are struggling with debt and want to explore this option, please contact my office and schedule a free and confidential consultation.

CLICK HERE TO SCHEDULE

BANKRUPTCY COURT OPEN DURING PARTIAL GOVERNMENT SHUTDOWN

Tax Amnesty

A Guest Blog by Joshua M. Dickinson, CPA

Now is the perfect time to come clean and catch-up on your outstanding tax obligations. Connecticut has introduced “CT Fresh Start” which is a Connecticut tax amnesty program which runs through November 30, 2018. Almost all tax types are eligible under the program including both business and individual income taxes, payroll withholding taxes, business entity taxes, gift taxes, and sales & use taxes. A taxpayer is eligible if they failed to file a return, or failed to report the full amount of tax on a previously filed return, for any return due on or before December 31, 2016. The program is generally not available for taxpayers who have already received a bill for unpaid taxes or are currently under audit by the Connecticut Department of Revenue Services. The benefits include no assessed penalties on the outstanding obligation as well as interest at 50% of the normal rate. The program also allows for a limited look-back period for eligible non-filers of only three years and no criminal prosecution. Connecticut has not offered a tax amnesty program in quite a few years and the window to apply under the program is relatively short, so don’t miss out! To see if you can take advantage, please contact Joshua M. Dickinson, CPA of Walsh & Dickinson at 203-447-0550 immediately.

Special thanks to my colleague, Joshua M. Dickinson, CPA (pictured here on the right with me and Attorney Karen Zarkades on the left), for submitting this article to my newsletter and blog. He is a partner at Walsh & Dickinson, a full-service CPA firm operating out of Shelton, Connecticut, specializes in the needs of small to medium size privately held business and individual clients. Josh has over 22 years of diverse experience helping clients located throughout Connecticut. Please contact Josh at Walsh & Dickinson at 203-447-0550 or www.cpaswd.com. Thank you.

October or…Never?

MEANS TEST NUMBERS ARE GOING DOWN

 

Bad News in the Bankruptcy World:

Bankruptcy qualification is based solely on household income. Every six months or so the Office of the United States Trustee changes the Means Testing figures. Come Novermber 1, 2018, the Means Testing Numbers are going down. This directly results in less people being qualified to file for Bankruptcy.

Good News For You:

If you are contemplating Bankruptcy, I am urging you to get tested as soon as possible to see if you qualify and can file in October before the changes take effect. During the remaining days of October, I am offering FREE Consultations 7 days per week and FREE Means Testing. Click HERE to schedule your appointment right away.

EVERYONE NEEDS A WILL!

If you are over the age of 18, you need an “Estate Plan,” especially if you have children.

A basic estate plan consists of three documents:

  1. A “Power of Attorney,” which appoints someone you choose who will have the power to do things on your behalf such as banking, real estate and other transactions if you are unable to do them yourself; please note that the only “power” this documents does not include, is the power to make health care decisions;
  2. A “Living Will,” which does two main things: appoints a health care agent (or someone to make your health care decisions) and designates organ donation; and
  3. A “Last Will and Testament.” This document only operates upon your death and it has two or three main functions, depending on your circumstances. First, it designates an “executor” to administer your estate in the Probate Court. Secondly, it directs your executor how to distribute your possessions. And lastly, if you have minor children, it appoints a guardian for your children to make sure they are taken care of by someone you trust instead of someone you don’t want to care for your children, like the state/DCF.

 

Contact Attorney Theresa Rose DeGray to discuss your personal Estate Plan today!

 

Frequently Asked Connecticut Bankruptcy Law Questions

Attorney Theresa Rose DeGray

Q: What is bankruptcy?

A: Bankruptcy is a legal process for people who cannot afford to pay their bills, and offers them a fresh start. The right to file for bankruptcy is granted by federal law, and all Connecticut bankruptcy cases are handled in federal courts located in New Haven, Bridgeport and Hartford.

Q: How can Bankruptcy help me?

A: Bankruptcy can eliminate unsecured debt, end collection harassment, stop foreclosures, prevent repossessions, stop wage garnishments and bank executions, and/or restore utility service.

Q: How often can I file bankruptcy?
A: You can file for a Chapter 7 Bankruptcy every eight (8) years. Chapter 13 Bankruptcies can be filed every six (6) years.

Q: What is the difference between a consumer bankruptcy and a corporate bankruptcy?

A: A consumer bankruptcy is for individuals or married couples that have personal, and not business, debt. A corporate bankruptcy is for a corporation, or non-human entity.

Q: What is the difference between Chapter 7 and Chapter 13?

A: A Chapter 7 results in a total discharge of most unsecured debt. A Chapter 13 is a repayment plan. Please see our Laws Page for an extended discussion on this topic.

Q: What does it cost to file for Bankruptcy?
A: We charge a fee for our services which will be quoted at our initial consultation. In addition to our fee for services, the bankruptcy court also charges filing fees.

Q: How can I pay for my Bankruptcy?

A: We offer affordable payment plans and accept all forms of payment, including cash, check, and debit cards from the person filing for bankruptcy. If a non-filer wishes to pay for our fees for their family member or friend, we will accept a credit card from that person. We honor MasterCard, Visa, Discover and American Express.

Q: What property can I keep?

A: You may keep all “exempt” property like your home, car, wedding rings, home furnishings, etc. All property that is not exempt is subject to liquidation and the resulting monies used to pay back your creditors. Do Not Be Alarmed: we strive to maximize your exemptions and protect all of your property.

Q: Will bankruptcy wipe out all my debts?

A: Yes, both Chapter 7 and 13 are designed to give you a fresh start with a clean slate.

Q: What is a discharge?

A: A discharge is a court order that says you do not have to repay your debts, but there are some exceptions, such as child support.

Q: Will I have to go to court?
A: Yes, in a Chapter 7 case, you will have to attend a proceeding once which is like a “court hearing,” although, it is very informal and presided over by a trustee and not a judge. A Chapter 13 case may require more than one court appearance, usually two or three.

Q: Will bankruptcy affect my credit?

A: Yes, but there are easy ways to rebuild your credit in a relatively short period of time following your final discharge.

Q: Will I be able to keep any credit cards?

A: No, you will have to fully disclose all of your debts and accounts, which will be closed and discharged. Bankruptcy is an all or nothing process. Full disclosure of your assets and liabilities is required and subject to penalties of perjury.

Q: Can I keep and use my debit card?

A: Yes, a debit card is not a credit card.

Q: Can I get a credit card after bankruptcy?

A: Yes, and you will be counseled on how and when to apply, and which type of card works best to rehabilitate your credit.

Q: Are utility services affected?
A: Current services will not be affected if the account is current or near current. Requests for new services after a bankruptcy may result in the utility company requiring a deposit.

Q: Can I be discriminated against for filing bankruptcy?

A: Absolutely not. Filing bankruptcy is a right given and protected by Federal Law.

Q: I am married, can I file by myself?

A: Yes, you may file as a married individual.

Q: If I am married and I file individually, will my spouse’s credit be affected?
A: No, your spouse’s credit will not be affected if he or she does not file.

Q: Can filing bankruptcy stop bill collectors from calling?
A: Yes, they will be prohibited from harassing you.

Q: Can I discharge my student loans by filing bankruptcy?

A: Generally student loans are not dischargeable in bankruptcy. There are a few exceptions to this general rule.

This firm is a debt relief agency. We help people file for bankruptcy relief amongst other things, under the Bankruptcy Code.

Mindful Money Management: 3 Strategies for Financial Success | By Caroline Wetzel, CFP®, AWMA®

How do you feel when you think about your financial situation? If you experience anxiety, uncertainty, or other unpleasant symptoms, you are not alone. Finances are a significant concern for many people. A 2017 study by Guardian Life Insurance Company of America entitled “Mind, Body, and Wallet,” found that money is cited as the #1 source of stress for a majority of American workers. The same survey showed that worry about personal finances is the leading cause of emotional stress and contributes to lower physical wellness.

But managing your money does not have to be an upsetting experience that negatively impacts you. Applying mindfulness techniques to your finances can help you cultivate a deeper awareness of your total financial picture, enabling you to approach your financial decisions with greater conviction and calculated risk.

What is Mindfulness?
Mindfulness is an intentional focus on the present moment. It has evolved over time to become a secular, psychological practice of developing and sustaining attention to thoughts, feelings, body sensations, and environmental stimuli that impact our experience of “now”.

Non-judgmental awareness of each moment is cultivated through mindfulness. Practitioners challenge themselves to attain a heightened sensitivity to the present through a variety of techniques including, but not limited to, meditation, pauses, and gentle movements. The impact of mindfulness on physical, mental, and social well-being is documented widely through scientific and academic studies.

Strategy 1: Create Space
Mindfulness promotes a consistent, ongoing process of using our senses to become more attuned to what is going on inside our bodies and outside us in our surrounding environment. This disciplined activity of “creating space” on a regular basis enables practitioners to experience feelings of groundedness and centeredness in the midst of racing thoughts and life’s busyness.

Try incorporating this strategy of “creating space” to your approach to your finances. Do you think about your finances beyond just paying the next bill that’s due? Do you know what you save and spend and check your statements? Do you review your insurance policies and ensure they continue to make sense for your needs?

Consider dedicating time – it can be as brief as a few minutes, or as long as 30 minutes, as long as it’s recurring – to pay your bills and consider questions like this as part of understanding your total financial picture. Formally reserve this time in your calendar and don’t cancel the appointment.

In the same way you go to the gym on a regular basis to take care of your physical health or ensure that you get a certain number of hours of sleep for your mental health, “create space” in your lifestyle to take care of your financial health.

Strategy 2: Plan with a Purpose
Mindfulness emphasizes awareness and non-judgment. Through mindfulness, we discover that our thoughts are narratives that we create as a result of our own unique perceptions and life experiences. Repeated practice of mindfulness empowers us to let go of the constant chatter – especially the negative thoughts – that monopolize our focus, and just be.

Adopt this same open, curious awareness to your financial situation. Without worrying about how you’ll do it, ask yourself “What do I want to do with my money?” Reflect on this question repeatedly during the spaces that you have created in your schedule, and observe what bubbles up for you. If the same priorities emerge each time you reflect on this question, these could be the goals that form the foundation of your unique financial plan.

When you are able to articulate clearly without judgment what is important to you and what you want to do with your money you can formulate a purpose-filled financial plan comprised of actions and behaviors that you can implement to make your financial goals a reality.

Strategy 3: Invest with Intention
Mindfulness facilitates sustained focus. It enables practitioners to cultivate greater clarity and improve their capacity to tune out distractions. As a result, mindfulness facilitates the ability to make decisions.

Apply this objective, intentional focus to your investment strategy. Do you know what you have invested your money in? Do you know why you chose the investments you selected? Are your investments in line with your values, comfort level with risk, and do they consider your tax situation?

When you invest with intention, you know what you invest your money in and why. This disciplined approach provides comfort and structure when the financial markets – and life – inevitably surprise us.

When you apply techniques promoted through mindfulness to manage your money, you can obtain greater control over your finances, confidence with your financial goals, and comfort that you are taking steps to realize your financial dreams.

By Caroline Wetzel, CFP®, AWMA®

Disclosure:

Caroline Wetzel is a Certified Financial PlannerTM (CFP®) and Vice President, Private Wealth Advisor with Procyon Private Wealth Partners, LLC.  Procyon Private Wealth Partners, LLC and Procyon Institutional Partners, LLC (collectively “Procyon Partners”) are registered investment advisors with the U.S. Securities and Exchange Commission (“SEC”). This article is provided for informational purposes only and for the intended recipient[s] only. This article is derived from numerous sources, which are believed to be reliable, but not audited by Procyon for accuracy. This article may also include opinions and forward-looking statements which may not come to pass. Information is at a point in time and subject to change. Procyon Partners does not provide tax or legal advice.

For more information:

Caroline Wetzel, CFP®, AWMA®

Vice President

Private Wealth Advisor

Procyon Private Wealth Partners, LLC

1 Corporate Drive. Suite 225  |  Shelton, CT  06484

M: (844) Procyon |  D: (475) 232-2713 |  F: (475) 232-2736

cwetzel@procyonpartners.net   |  www.procyonpartners.net   |  https://www.linkedin.com/in/caroline-wetzel/

This firm is a debt relief agency. We help people file for bankruptcy relief amongst other things, under the Bankruptcy Code.