Bankruptcy

This is Sam’s favorite question because he enjoys pointing out that Congress outlawed debtors’ prisons in 1838. In other words, no, you cannot go to jail if you do not pay your debts, but debt collectors can make your life difficult.

Marks Law Firm offers bankruptcy services in central Iowa including Des Moines and the following cities:

• Ames, Iowa
• Marshalltown, Iowa
• Winterset, Iowa
• Osceola, Iowa
• Chariton, Iowa
• Norwalk, Iowa
• Johnston, Iowa

Unsecured debt is debt that does not have collateral attached to it. For example, medical bills are an unsecured debt because if you do not pay the debt, there is nothing that they can take from you to pay off your balance. For what it is worth, we have had many clients worried about a dentist taking out their fillings if they claim bankruptcy. That just does not happen. If you are concerned about the impact of a bankruptcy on your unsecured debt, come in for a free consultation and we can walk you through it.

Secured debt is debt that has collateral attached to it. For example, a vehicle loan is a secured debt because if you do not pay the debt, they can repossess the car to pay off your balance. Real estate is another good example of a secured debt.

Non-dischargeable debts are debts that will not be discharged, or forgiven, when filing bankruptcy. These may include:

• Most student loan debt
• Court fines and fees
• Government fines and fees
• Federal tax liens
• Reaffirmed debt
• Court-ordered alimony and child support
• Debts you intentionally left off of your bankruptcy

Dischargeable debts are debts that can be discharged through a bankruptcy proceeding. This means that once you receive a discharge, you will no longer be responsible for these debts. Some examples of dischargeable debts include: medical billscredit card bills, personal loans, past-due utility bills/rent, civil court judgements, auto accident claims and repossession deficiency balances.

• Medical Bills
• Credit Card Bills
• Personal Loans
• Past-due Utility Bills/Rent
• Civil Court Judgements
• Auto Accident Claims
• Repossession deficiency balances

You can find out who you owe money to by looking at your credit report and collecting all of the bills that are sent to you. It is a good idea to start saving bills a couple of months before filing bankruptcy to be sure that all of your creditors are included. If you become aware of more creditors after the bankruptcy is filed there are options for including them. Medical bills are tricky and often do not show up on a credit report. Try to remember any medical providers that you have had to make sure that they are included.

Possibly. Every bankruptcy case is different and has its own set of circumstances that are used to determine whether you can keep your tax refund or not. When you file your taxes and when you file your bankruptcy can make a difference. The amount of your tax refund can make a difference as well.

You can discharge some but not all tax liability. It is based on when the taxes came due, when the returns were filed and when the taxes were assessed. Each case is different, and you need to talk to an attorney to see how these rules will apply to your unique case. Be careful, not all attorneys understand the nuances to the issue of tax liability.

The court can take all property you are not allowed to keep under the Bankruptcy Code. Most frequently, the court will take extra vehicles, large sums of money such as tax refunds or inheritances, and excess jewelry or property.