Bankruptcy Mastery

Becoming a better bankruptcy lawyer

Find Solution That Works, Bankruptcy or No

By Filed Under: Bankruptcy Practice

Procrutes assaulting his guest upon the bed

Good income, substantial priority tax debt, other debt within the limits:  sounds like a Chapter 13 bankruptcy, doesn't it? Yet the clients were in my office for a second opinion, convinced they couldn't sustain over five years the payments their attorney provided in their Chapter 13 plan. Their attorney's approach reminded me of the Greek story of the brigand Procrustes, who waylaid … [Continue reading...]

Prompt Full Disclosure from Bankruptcy Clients

By Filed Under: Before filing, lawyer skills, Start Here

interview trick

If the price of a bankruptcy discharge is full disclosure, some clients still want to underpay. No matter how carefully you script your initial interview with a client in quest of everything you need to know to advise them on bankruptcy, there will be some tidbit, relevant to your quest, that isn't evoked with your questions. But, never fear, you have another trick up your sleeve:  the open … [Continue reading...]

Why The No-Look Fee In Bankruptcy Harms Us All

By Filed Under: Attorneys fees

no-look fees in Chapter 13 bankruptcy

The no-look fee is no good  in many bankruptcy cases.  It harms debtors, their lawyers, and the system as a whole.  It fails to compensate the lawyer for critical work, causing a disincentive to providing proper representation. We give up a lot when we settle for being paid just the no-look fee. How we got here No-look (or presumptive) fees were instituted to relieve courts … [Continue reading...]

How To Brush Off The Means Test

By Filed Under: Means test

avoid means test

There's a way around the means test.  And it's right there in the Code.  Yet we forget. The ***x!!XXX thing only applies to debtors whose debts are primarily consumer. Consumer debt is defined: 8) The term “consumer debt” means debt incurred by an individual primarily for a personal, family, or household purpose. I had to review what isn't consumer debt the other day to … [Continue reading...]

Dig Deep In Your First Meeting With A Prospective Client

By Filed Under: Before filing, lawyer skills

client interview

The success of a bankruptcy case is frequently determined at the first meeting between client and lawyer. The information that is exchanged and the confidence that is built at that  encounter shapes the client's expectations, the choice of chapter, the timing of the filing and much more. So I cringe when I hear stories about the first, frequently "free", consultation between prospective … [Continue reading...]

4 Reasons To Keep Time Records No One Discusses

By Filed Under: Attorneys fees

discharge violation is expensive

Mention keeping time records to a bankruptcy lawyer and you're likely met with expressions of utter revulsion. I swear that all too many assert that the major appeal of being a bankruptcy lawyer is precisely that they don't have to keep time. Between flat fee deals with clients, and no look fees in Chapter 13, they feel liberated from the clock and the time sheet. What a … [Continue reading...]

The Chasm Between Judges & Bankruptcy Attorneys Over Fees

By Filed Under: Attorneys fees, Opinionated

Why is there such a gap between consumer attorneys and bankruptcy judges over attorneys fees? Sources tell that it sometimes feels like the bench believes that every dollar a debtor's lawyer gets is of questionable legitimacy. Yet the same judges roll their eyes, at least figuratively, at the competence and preparation of those same lawyers. Think there might be a connection?  Does the … [Continue reading...]

Tax Changes & Projected Expenses

By Filed Under: Means test

tax changes ahead

  At the risk of borrowing trouble, I'm looking ahead to changes to the tax laws that may adversely impact pending Chapter 13 cases. The 2017 Tax Cuts and Jobs Act ( probably as appropriately named as the Bankruptcy Abuse and Consumer Protection Act)  limits the deductibility of state and local taxes, including property taxes.  A married couple can deduct only $10,000 of those … [Continue reading...]

Bankruptcy as Means to Keep the House

By Filed Under: Counseling clients, Real property

house

There's nothing like a foreclosure to get homeowners to see a bankruptcy lawyer. They are often not sure just how bankruptcy will accomplish this, but they are resolute that keeping the house is the centerpiece of their bankruptcy. A capable lawyer can tell the client how that might be done through bankruptcy;  a standout bankruptcy lawyer challenges the premise altogether. Often … [Continue reading...]

Don’t Skimp On Service When Your Client’s House Is On The Line

By Filed Under: Rule 3002.1

Rule 3002.1 service

Is the Chapter 13 trustee jeopardizing the benefits to my client of Rule 3002.1 by sloppy service? Unwilling to expend more than a single postage stamp to effect notice?  Just going through the motions here? The short answer is: I don't know yet. But the issue stood out when, for reasons that are yet inexplicable, the trustee and my office each filed a Notice of Final Cure Payment … [Continue reading...]

Direct Mortgage Payments: Inside, Under, Or Outside The Plan

By Filed Under: Cases new & significant, Rule 3002.1

payments under plan

Are post petition payments on the debtor's mortgage "under the plan"? Not in the view of  one judge. Direct payments on a a residential mortgage loan are not "payments under the plan" for purpose of Bankruptcy Code § 1328(a), Thus Judge Thomas Perkins struck back at the cases that have used failure to maintain mortgage payments during a Chapter 13 case as grounds to find debtors ineligible for a … [Continue reading...]

IRS Trick I’d Never Seen Before

By Filed Under: Bankruptcy Practice, Tax

IRS excise tax

The third amended IRS claim in my client's case added entries for an excise tax for 2015 and 2016. Excise tax?  New one on me where the debtor was a general contractor. I called the IRS agent on the POC for some hints as to what the tax was all about .  I needed to know how to analyze whether it was real and correct.  It was enough money to threaten the feasibility of the … [Continue reading...]