Monthly Archives: October 2011

Landlords use several factors in determining who they will rent to and what if any deposits will be required for the rental including: rental history, credit score, job history, monthly debt payments, monthly income, etc.

WHAT IS RENTAL HISTORY

Rental history is the verification is much more accurate nowadays than in the past for landlords. There a specific sites where your landlord can go to check to see if you have had any evictions or late rental payments in the past. It is a separate report from your credit report.

WHAT IS CREDIT HISTORY

Your credit history is reflected on your credit report and it shows accounts, payment history, age of the accounts, balances on those accounts. This is equally, if not more important than your rental history when you are trying to obtain approval for a new apartment. Most of the time evictions and judgments obtained by landlords will also be reflected on your rental history.

It can be frustrating if you have made mistakes in the past and have negative rental or credit history in your past and to have your rental applications rejected. Those negative items on your credit report stay on for a minimum of seven (7) years. A fresh start maybe just what you need to get things in prospective. In a Chapter 7 you can have those evictions and judgments eliminated and start anew.

Maxwell Law Firm represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, and loan modifications. You may schedule your appointment by calling 704-780-1100.  Save an additional 25% off the fees by scheduling your appointment online at http://maxwelllegal.com/consultations. California Bankruptcy Attorney  Chirnese L. Liverpool assists clients with filing for bankruptcy in the Los Angeles Area. Her office can be contacted at 818-714-2200.

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TAX EXEMPT VS. REQUIRED TO FILE A RETURN

When filing out your W4 you are required to list what if any tax exemptions you are claiming and if you are exempt from federal income taxes.

Someone or an entity who is tax exempt is someone who is not required file a return based on a tax exemption status and or exclusion by Law.

On the other hand some people are not required to file a tax return because they are below a certain income level based on the filing status and amount of income earned during that tax year. This does not mean that this person is tax exempt, it merely means that person does not have to file a return for that particular year.

WHO IS TAX EXEMPT

Well first and foremost most individuals are not exempt from from taxes. 501(c)(3) Non-profit organizations can apply for tax exempt status but do not automatically have this status by the virtue of forming a non-profit organization.

Generally, charitable organizations,  Churches and Religious organizations, Other Non-Profits,  Political Organizations, and Private Foundations fall under this category.

For this application to be approved the organization must establish the following:

1. The organization is organized exclusively for, and will be operated exclusively for, one or more of the purposes (religious, charitable, etc.) specified in the introduction to this chapter.
2. No part of the organization’s net earnings will inure to the benefit of private shareholders or individuals. You must establish that your organization will not be organized or operated for the benefit of private interests, such as the creator or the creator’s family, shareholders of the organization, other designated individuals, or persons controlled directly or indirectly by such private interests.
3. The organization will not, as a substantial part of its activities, attempt to influence legislation (unless it elects to come under the provisions allowing certain lobbying expenditures) or participate to any extent in a political campaign for or against any candidate for public office. See IRS publication 557

WHAT HAPPENS IF I CLAIM TAX EXEMPT STATUS AND I SHOULD NOT HAVE

Claiming tax exemption when you are not exempt could result in a fine of $500 and not to mention additional penalties and interest for failing to file a return or have the correct amount withheld from your wages. Not to mention you will have a large tax bill for that year for taxes that should have been withheld but were not as a result of you claiming tax exempt. Definitely go see a tax professional to see if there someone that can be done to reduce your tax liability and help set you up on a some sort of agreement or payment plan with IRS.

Maxwell Law Firm, PLLC represents clients all over the United States on Tax related issues: Garnishments, Tax Liens, Tax Collection Defense, Offers in Compromise, Installment Agreements, and  Income Tax Services  you may call them at 704-461-1883 or save 25% off our already affordable fees by your appointment scheduling online. California Bankruptcy Attorney Chirnese L. Liverpool assists debtor with filing for bankruptcy in the Los Angeles area. You may contact them at 818-714-2200.

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I often have individuals come into my office who receive the CP-2000 notice stating that they are unsure of what to do next, says Tax Attorney Victorianne Maxwell of Maxwell Law Firm, PLLC.

WHAT IS INCOME FOR TAX PURPOSES

Funds received for services, employment, earned interest, annuity payments, sale/exchange of capital gains, any other funds received where there is not an exception to income.

WHAT IS CONSIDERED AN UNDERREPORTING OF INCOME

Underreporting of income results when a taxpayer fails to report income on their tax return.

HOW WILL IRS KNOW IF I UNDERREPORTED INCOME

Employers are required by law to report wages they have paid out and taxes withheld on a W2 form to IRS. Companies who use contract labor are required to report how much have been paid to these service professionals on what is called a 1099 Form. The same is true of cashed in retirement accounts, transferred accounts, and the sale/exchange of capital gains. Intuitions that pay out interest are similarly required to report the interest earned that year on a 1099-INT form. IRS regularly runs reports and checks to see if the amount of income reported on a tax return matches what was reported by other third parties. If you received a large refund or are self-employed you are more likely to be targeted for such an underreporting notice.

WHAT ARE THE CONSEQUENCES OF UNDERREPORTING INCOME

You will receive a CP-2000 Notice stating that there has been an underreporting of income and what your estimated liability should be vs. what you were refunded or paid. You have a limited amount of time to respond and or dispute the CP-2000. If you do nothing than the IRS will deem that this amount is due.

WHAT SHOULD I DO IF I RECEIVE A NOTICE

You should contact a tax professional immediately. If you do not agree with the notice either because you feel that income mentioned in the notice was reported or was not earned by you, then your Tax Attorney can contact IRS and initiate a dispute. This will provide you with the time necessary to come up with the time necessary to gather the correct documents to dispute the notice. If you do agree there was an underreporting of income, then your Tax Professional can probably go through the return and amend it to see if there are any additional tax credits available to apply to return to reduce your liability. In addition, that tax professional can assist you with installment plan to help you get back on track.

Maxwell Law Firm, PLLC represents clients all over the United States on Tax related issues: Garnishments, Tax Liens, Tax Collection Defense, Offers in Compromise, Installment Agreements, and  Income Tax Services  you may call them at 704-461-1883 or save 25% off our already low fees by your appointment scheduling online. The LA Bankruptcy Attorney Chirnese L. Liverpool assists debtors with having old tax debt discharged. You may contact her at 818-714-2200.

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NEW FILING BANKRUPTCY FEES

The Judicial Conference of the United States adopted a new court fee schedule on September 13, which will become effective November 1, 2011. The revenue generated by the fee change will go into the Judiciary’s budget.

The new BANKRUPTCY filing fees will be:

· Chapter 7: $306.00

· Chapter 11: $1046.00

· Chapter 13: $281.00

BANKRUPTCY ATTORNEY’S FEES

Maxwell Law Firm, PLLC represents clients in the Charlotte Metro Area of North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, our fee for representation can be viewed on our wepage under bankruptcy fees  or call 704-461-1883. Our rates are valid until December 1, 2011. You can save an Additional 25% off the Attorney’s fees by scheduling your appointment online.  The Law Offices of Chirnese L. Liverpool assists clients in the Los Angeles Area of California and in the state of Nevada with filing for bankruptcy. Her office can be contacted at 818-714-2200.

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Most recently I had someone in my office who had taken out several payday and title loans in order to stay current so I decided to discuss further here on this blog, says Bankruptcy Attorney  Victorianne C. Maxwell

PAYDAY LOANS IN GENERAL

They are often referred to as a paycheck advance. It is a small, short-term loan that is intended to cover a borrower’s expenses until his or her next payday.

GENERAL TERMS OF A PAYDAY LOAN

The payday companies do not run a credit check the deposit the funds into a checking account within 24 hours after it is approved. The interest rate on these loans are often extremely high. Payday lenders usually charge a fee of at least $15 – 30 for every $100 borrowed. In 2006, Congress capped the interest rate for payday loans to military personnel at 36%.

FAILING TO PAYBACK YOUR PAYDAY LOANS

Typically, payday lenders will debit your checking account in order to collect their fees and the balance on your loan. If the payday lender deposits your check and it bounces or the funds are not available, your bank will charge you bounced check fees. Also, the payday lender can potentially sue you for the default.

LEGALITY OF PAYDAY LOANS?

In North Carolina, payday companies are labeled predatory lenders and have been banned. Several companies have been fined by the North Carolina Attorney General’s office for their practices.This means they can not operate in the state of North Carolina. Some payday lenders find loopholes and offer their services over the internet. If they offer serves to a resident of North Carolina the interest rate is capped at 36%.

HOW CAN I CANCEL THE PAYDAY TRANSACTION? 

Unfortunately, most people will end up taking out these loans continue to take these type of payday loans out a continuous basis and end up paying out more in fees than the actual value of the loans. Often times the borrowers become reliant on these loans to pay their bills. There are other options like cash advances. Though cash advances are often at a high rate of interest they are less costly than payday loans. If the issue with credit itself is becoming a problem it may be time to go see a Bankruptcy Attorney who can help you with a fresh start. Payday loans are unsecure debts which are discharged in chapter 7 bankruptcy  and eventually discharged in a chapter 13.

Maxwell Law Firm PLLC represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, and loan modifications. You may schedule your appointment by calling 704-461-1883 or save 25% off the fees and schedule online. California Bankruptcy Attorney  Chirnese L. Liverpool  assists debtors with California payday companies she can be contacted by calling 818-714-2200.

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Often times Potential Client’s come into the office wanting to know more information about loan modifications , says Bankruptcy Attorney  Victorianne C. Maxwell, and I explain the most general terms how they generally how they work.

WHAT IS A LOAN MODIFICATION ?

Lenders agreement to change the terms of the mortgage agreement by either decreasing the amount of monthly payments, lengthen the term of the loan, and or decreasing the amount of interest on the loan.

WHAT IS INVOLVED IN THE PROCESS

Generally, the mortgagee/lender has a specific department that deals with the intake of loan modification requests. These departments “determine” whether a particular borrower qualifies for the request. If they make an initial determination on the request that the borrower “qualifies” they will direct the borrower to submit paperwork and other items. A person in that department may make some suggestions to the borrower on how to be approved for the request. The most frequent one I hear about is for the borrower to stop paying their mortgage. Be careful with heeding to this advice as these employees are not Attorneys and do not know the ramifications of what they are advising you to do. In North Carolina, for example, if you default on your mortgage nothing short of bankruptcy will stop foreclosure once they process has begun. This is the case even if you have a loan modification application pending.

IS TRUE THAT A LOAN MODIFICATION COMPANY CAN INSURE THAT MY APPLICATION IS APPROVED

No, although there is some governmental incentive to approve most loan modifications the lender is under no obligation to approve your request. Beware of any company that can guarantee absolute success on Loan Modification approval, because more than likely it is a scam. These companies are filed with people who have the same or sometimes less knowledge about Loan Modifications and the Law.

WHAT IS Home Affordable Mortgage Program (HAMP)

H.A.M.P. it is federally sponsored loan modification program that was created in 2009. The program will expire on December 31, 2012. There are incentives for both lenders and servicers. Though virtually most lenders are offering loan modification programs, but not all are participating in the HAMP program. There is no requirement that lenders participate in the program only incentives to do so.

WHAT KIND OF RECOURSE DO I HAVE IF MY LOAN MODIFICATION DOES NOT GO THROUGH

There are some cases right now where a borrower has sued their Lender for “unfair and deceptive trade practices” for denying their loan modification. But these type of cases are costly and time consuming, If you are in a situation where you are behind on your mortgage the last thing you want to do is incur another cost in the hopes of winning a battle against the Lender.

DO I HAVE OTHER OPTIONS

Yes you do. If you can qualify for a refinance at a lower fixed interest rate than that would be a good first step. If not then you need to consult with a Attorney who has experience dealing with Loan Modifications, Foreclosures, Bankruptcy, or any other debt relief.  Chapter 13 Bankruptcy offers the option to modify secure debts  such as mortgages and car loans. In a Chapter 7 the process can be achieved but will need to be initiated outside of the bankruptcy proceeding.

Maxwell Law Firm represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, and loan modifications. You may schedule your appointment by calling 704-780-1100 or save 25% off the fees and schedule online at http://maxwelllegal.com/consultations. In Los Angeles Bankruptcy Attorney Chirnese L. Liverpool assists clients with Chapter 7 bankruptcy.

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Recently, I had a client come in and ask me about reverse mortgages and how they were affected in Bankruptcy, says Bankruptcy Attorney Victorianne C. Maxwell of Maxwell Law Firm, PLLC and I decided to do some research on it.

WHAT IS A REVERSE MORTGAGE

A mortgage in which a homeowner, usually an elderly or retired person, borrows money in the form of annual payments which are charged against the equity of the home. This seen as an alternative to a home equity line.

To qualify for a reverse mortgage the borrower must meet these requirements:

• Be 62 years of age or older ;
• Own the property outright or have a small mortgage balance;
• Occupy the property as your principal residence;
• Not be delinquent on any federal debt AND;
• Participate in a consumer information session given by an approved HECM counselor.The requirements of the reverse mortgage a less stringent than a traditional mortgage. No income or employment qualifications are required of the borrower. No payment is not required as long as the property is your principal residence and the obligations of the mortgage are met and the closing costs may be financed in the mortgage.

  CAN THE BANK FORECLOSE IN A REVERSE MORTGAGE

  Borrowers can choose an adjustable interest rate or a fixed rate. So when the payments become due either because the borrower no longer use the home as a primary residence, defaults, or dies. FHA allows reverse mortgage lenders to go ahead and foreclose on properties that warrant it. Foreclosure can occur when the debtor fails to make the payments due or defaults in some other fashion such as a failure of pay taxes or maintain home owner’s insurance. If the Owner dies than the heirs owner must pay off the mortgage either by refinancing or assuming the mortgage debt in order to keep the home.

  ARE THEIR ANY WAYS TO VOID THE REVERSE MORTGAGE

  Immediately after closing you have an opportunity to void the reverse mortgage. However, once you have started receiving payments the mortgage can not be voided and you will have to pay off the balance of loan (payments made) to cancel the loan thereafter.

  REVERSE MORTGAGE AND BANKRUPTCY

  Your home is considered an asset and anything in access of exemption allowed for equity in your jurisdiction, can be used to satisfy some of your debts before you are granted a discharge in a Chapter 7 Bankruptcy.  You should definitely speak to a Bankruptcy Attorney in your area if you are considering bankruptcy and you have a reverse mortgage to know what the implications of filing for bankruptcy will be.

   

  Maxwell Law Firm represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, and loan modifications. You may schedule your appointment by calling 704-780-1100 or save 25% off the fees and schedule online at http://maxwelllegal.com/consultations. The Law Offices of Chirnese L. Liverpool assist debtors in Los Angeles with filing for Bankruptcy in California they can be contacted at 818-714-2200.

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Often times potential clients ask me if their credit debts are going to be discharged in bankruptcy and I tell them generally yes but there are some exceptions, says Bankruptcy Attorney Victorianne C. Maxwell of Maxwell Law Firm, PLLC.

Credit cards are generally are categorized as unsecured debt and that is discharged at the close of a chapter 7 case. But in limited circumstances, credit card is discharged if:

• When credit is extended based on false pretenses or fraud OR
• Luxury goods purchased within ninety (90) days before  filing OR
• cash advances aggregating more than $750 that are extended to a debtor within 70 days before filing   OR
• The debt was incurred paying off fines, penalties, and taxes under federal or state law.

Note that debt incurred for purchasing goods or services reasonably necessary for the support or maintenance of the debtor or a dependent of the debtor, such as food, clothing, shelter/utilities before filing will be dischargeable. If you have questions regarding the type of debts you have an which of them will be dischargeable the best thing for you to do is to consult with a Bankruptcy Attorney in your area.

Maxwell Law Firm, PLLC represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, and loan modifications. You may schedule your appointment by calling 704-780-1100 or save 25% off the fees and schedule online at http://maxwelllegal.com/consultations. The Law Offices of Chirnese L. Liverpool assists debtors with filing for bankruptcy in Nevada and in California. They can be reached by calling 818-714-2200.

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One of the frequent questions or issues that come up during a consult is whether social security or pension income is income for purposes of determining eligibility  under the means test in Bankruptcy, says Bankruptcy Attorney Victorianne C. Maxwell. The mean test is important because it determines whether a debtor qualifies for Chapter 7 Bankruptcy.

GENERAL SOURCES OF INCOME THAT ARE FACTORED INTO DETERMINING INCOME FOR PURPOSES OF BANKRUPTCY

• wages, salary, tips, bonuses, overtime, and commissions
• gross income from a business, profession, or a farm
• interest, dividends, and royalties
• rental and  real property income
• regular child support or spousal support
• unemployment compensation
• pension and retirement income
• workers’ compensation
• annuity payments
• state disability insurance

SOCIAL SECURITY BENEFITS EXCEPTION & BANKRUPTCY

Under the social security statute 42 U.S.C. § 407 (a) In general The right of any person to any future payment under this subchapter shall not be transferable or assignable, at law or in equity, and none of the moneys paid or payable or rights existing under this subchapter shall be subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law.

AND

There is also a federal exemption  of social security benefits under 11 U.S.C. § 522(d)(10)(A) for social security benefits. What this means is that social security benefits are excluded from being factored into the debtor’s income to determine whether they qualify under the means test.

OTHER PENSION OR RETIREMENT PAYMENTS

There are no \ exemptions for pension disbursements or payments; therefore, this is included in the calculation for monthly income of a debtor filing bankruptcy.

I’VE LOOKED AT THE NUMBERS AND STILL DON’T THINK ILL QUALIFY

There are other factors that determine eligibility  to file for bankruptcy, such as expenses and those allowed on IRS standards. You should consult with a Bankruptcy Attorney so that they can do a thorough evaluation of your case.

Maxwell Law Firm, PLLC represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, and loan modifications. We have two offices in North Carolina one in Concord and in Charlotte. You may schedule your appointment by calling 704-461-1883 or save 25% off the fees and schedule online at http://maxwelllegal.com/consultations. In California and Nevada the Law Offices of Chirnese L. Liverpool assists debtors with Bankruptcy and debt related issues. They can be contacted by calling 818-714-2200.

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Often times I have persons who enter my office and say they have been told they can not file Chapter 7, because their income is above the median income for their household size. However, the median income is not always the only factor used to determine someone’s eligibility, says Bankruptcy Lawyer Victorianne C. Maxwell.

The means test also evaluates a debtors reasonable and necessary expenses based on the figures allowed under the Tax Code. Some of these expenses include:

Rent or home mortgage payment (including lot rented for mobile home)
● Electricity, natural gas, butane
● Cable television
● Internet service
● Water and sewer
● Telephone (including cellular phones)
● Trash service
● Home maintenance/repairs
● Food
● Clothing
● Laundry and dry cleaning
● Medical and dental expenses (out of pocket)
● Transportation (including gasoline, vehicle maintenance and/or public transportation)
● Recreation/entertainment (must be reasonable in amount)
● Charitable contributions (not exceeding 15% of gross monthly income)
● Homeowners or renters insurance
● Term life insurance for yourself (but not insurance on any of your dependents)
● Health insurance (including HMO, etc.)
● Automobile insurance
● Property taxes
● Automobile payments (including lease payments)
● Alimony or child support payments
● Child care (such as baby-sitting, day care, nursery and preschool)
● Pet care
● Regular expenses from operation of a business or profession
● Student loan payments
● Educational expenses that are required as a condition of employment
● Tax payments to I.R.S. or state taxing authorities if not dishargeable in bankruptcy
● Involuntary retirement contributions that are required by your employer
● Voluntary retirement contributions*
● Payroll taxes (including income taxes, social security, medicare, etc.)
● Self-employment taxes
● Union dues
● Mandatory expenses required for employment (such as uniforms, parking, etc.)
● Payments for necessary household items (such as furniture, appliances and/or computer)
● School expenses for minor children under 18 years (up to $137.50 per month per child)
● Sport or school activities for minor children

If a debtor can provide documentation to prove additional expenses above those allowed they can more than likely support the argument that their expenses exceed their expenses and pass the means test. Talking to a qualified Bankruptcy Attorney  in your area would be your first start to determining whether you can actually make this argument. There are so many other factors that go into determining your eligibility for Chapter 7.

Maxwell Law Firm represents clients in North Carolina with: bankruptcy court, filing for bankruptcy, chapter 7 bankruptcy, foreclosure defense, chapter 13 bankruptcy representation, and loan modifications. You may schedule your appointment by calling 704-780-1100 or save 25% off the fees and schedule online at http://maxwelllegal.com/consultations. California Bankruptcy Attorney Chirnese L. Liverpool assists debtors in the Los Angeles Area with filing for Chapter 7 and they can be reached at 818-714-2200.

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