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Tax Bankruptcy may not be the best solution for everyone it has some conditions. Be sure to consult with a tax professional before filing for it.
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While bankruptcy should be considered a last resort, for those who are in financial straits, there are benefits to filing bankruptcy. We out line those benefits in this presentation. Remember, bankruptcy may not be the best solution for everyone. Be sure to consult with a professional
before filing.
PROS AND CONS OF FILING FOR BANKRUPTCY
Part 1: Pros of Filing for Bankruptcy
Part 1 The Pros of Filing for Bankruptcy
For many, financial protection is an important reason for filing for bankruptcy. When a
person files for bankruptcy, an automatic stay on collection is put in place. The
automatic stay restricts creditors from taking any legal action to collect debt outside
the bankruptcy process. The automatic stay essentially provides a shield against
creditors until the bankruptcy ends.
Automatic Stay on Collection
Bankruptcy damages your credit. However, once creditors see that you have taken
strong steps to resolve your debt problems, they are often more willing to work and
help you re-establish your credit. It can help you in getting a quick start on rebuilding
your credit.
Jump Start to Rebuilding Your Credit
A Chapter 7 bankruptcy allows for the permanent discharge of most unsecured
debts. This means that debts like credit card bills, utility bills, medical bills, etc. will
be forgiven. Student loan debts or back tax debts must meet specific qualifications
before they can be discharged.
Discharges Debts
Another advantage of bankruptcy is though many of your assets will be liquidated to
pay your debts, certain property is exempt, including your home, principal vehicle
and other necessary items. Generally, property that is reasonably essential to the
necessities of life is exempted from sale in a Chapter 7 petition.
Can Save Property
Bankruptcy stops other collection actions like wage garnishment, foreclosure and
repossession proceedings.
Stops Garnishment
"Pros and Cons of filing For Bankruptcy." The Law Office of Areya Holder. Holder Law, 10 September 2010. Web. 1 July 2015.
<http://www.holderlawpc.com/blog/pros-and-cons-of-filing-for-bankruptcy/index.html>
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VISIT WWW.TAXASSISTANCEGROUP.ORG
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