The all new bankruptcy law is even harsher than the old one, established in 1978. It tightens the requirements of those who are filing for bankruptcy and for the attorneys that are helping them do so.
Key Changes In The All New Bankruptcy Law
A so-called “means test” has been created in order to better assess whether or not a person is right for bankruptcy.
When you take the means test the government will calculate your monthly income minus a few allowed expenses. If it turns out that your monthly income is above the median income you will be obligated to file chapter 13 bankruptcy.
The IRS has set up some strict guidelines for your allowable expenses. You will be permitted up to 200 $ every month for your food and an additional 800 $ every month to cover the costs of your home.
It is essential to understand that there are both state and federal bankruptcy laws. You will find that some state laws are more lenient than others.
You will have to attend a mandatory credit-counseling course that has to be approved by the IRS within 180 days of your filing for bankruptcy. This is not a free course. Instead it will cost you approximately $ 75.
Paperwork is another thing that has been significantly increased with the new law.
Some of the things that you are going to have to provide the IRS with will include: a list of all your unsecured and secured creditors; a detailed list of your expenses and your monthly income; liabilities and assets; your most recent tax return; your photo ID and pay stubs.
There are now hefty legal fees that you will have to pay thanks to this all new bankruptcy law. This is because you will have to have a bankruptcy attorney ?certify? that your figures are accurate.
Interpreting the bankruptcy law
At the time of writing there is nothing in the bankruptcy law that states you must have a bankruptcy lawyer on your case. Nevertheless with the exception that you have studied the law, you really should use a bankruptcy lawyer, you will need his experience to make sure you get the best result out of your bankruptcy for yourself.
You do not want to go through this in an attempt to save yourself some money since it will only come back to haunt you in the end. Therefore, it really is in your best interest to have an experienced bankruptcy attorney interpret the bankruptcy law for you.