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Filing for bankruptcy can provide you with the fresh start you need to get back up on your feet after some hard time. Unfortunately, many people wait too long and delay the process of getting help and starting over.
Numerous people seek help through the bankruptcy process. People who have found themselves with growing debt that they just can’t seem to pay down no matter how hard they try.
Some of the most common reasons for this hardship is medical bills, the loss of a loved one, the loss of a job, or the failing of a small business. Hard working people who, often through no fault of their own, have found themselves in tough times and in need of a boost to get back on their feet. Every person has a life story that has many ups, downs, twists and turns.
Sadly many people wait until its almost too late, or sometimes past “too late”, to ask for help and fix their situation. Houses get foreclosed on because of past due mortgage payments, phones are avoided because of aggressive debt collection agencies, bills and notices get left unopened (often creating even more of a problem) because its too stressful to deal with, and mental and physical health deteriorate as a result of the stress.
The Fresh Start You Need
Bankruptcy can provide the fresh start. Often you can utilize this valuable process to save your home from foreclosure auction, bring your debts down to a manageable level, and finally breathe a sigh of relief when you haven’t been able to do so in quite some time.
Help can be found fairly easily simply by picking up your phone or searching the web for a bankruptcy attorney near you. The attorney can assess your particular situation and advise if bankruptcy is the most appropriate course of action to get you back on track to a manageable debt load.
How does it work?
There are generally two types of bankruptcy cases for individual consumers, a Chapter 7 or a Chapter 13, each with its own benefits, requirements, and process.
A Chapter 7 bankruptcy is the kind most people think about. Chapter 7 bankruptcy wipes out most of your debts, including credit cards and medical bills. However, you must qualify in order to file for Chapter 7 and the qualifications are mainly based on your income. One of the main ways to know if you qualify for a Chapter 7 bankruptcy is to look at the current median income by family size for the state you reside in and determine if your income is below that number. For Massachusetts the current median income as of January 8th, 2019 is:
- Family of one: $64,907 per year
- Family of two: $81,339 per year
- Family of three: $102,059 per year
- Family of four: $127,579 per year
- (Add an additional $8,400 for each individual above four)
If your household income is below that amount you are presumed to qualify for Chapter 7 bankruptcy. The Chapter 7 case typically moves through the system much quicker than a Chapter 13 case will, and allows you to discharge most debts including credit cards, unsecured personal loans, medical debt, and car repossession deficiencies among others. However, debts such as student loans, taxes owed to the government, spousal support or child support, and most other divorce related debts are among some that are non dischargeable.
If you do not qualify for Chapter 7, or if your circumstances would be better suited for it, you may still find relief in Chapter 13 bankruptcy. Chapter 13 bankruptcy is more like a structured repayment plan where your creditors will receive partial repayment of the debt over a 3-5 year plan, and once completed the remaining balance of your debt is discharged. Chapter 13 bankruptcy is also a way to stop home foreclosures and catch up on mortgage or car defaults. Your attorney can help you determine what plan is best suited to meet your needs and begin the process for you.
Do I lose all my stuff?
The short answer is no. When you file for bankruptcy in Massachusetts you can select to take state exemptions or federal exemptions for your property. An “Exemption” is the type and amount of property the Bankruptcy statutes have said is protected from being sold off or otherwise used by the Bankruptcy Trustee to pay towards your debts. Among the exemptions are those for cars, homes, and personal belongings that many people can use to protect most if not all of their property. Deciding whether to use the Federal Bankruptcy Exemptions or the Massachusetts Exemptions is one of the most important things your attorney can help you with.
Do I need an Attorney?
While an attorney is not a requirement to file your case, my answer would be emphatically yes, you do need an attorney. In addition to helping you determine what Chapter of bankruptcy you qualify for and what exemptions to use to protect as much of your property as possible, your attorney will also help make sure all of your creditors are notified that you have filed for Bankruptcy. This is an important step that not only makes sure that they don’t harass you for payment, but also is a requirement for the debt to be discharged at the end of your case. Therefore it is important that you hire a knowledgeable Bankruptcy Attorney in your area to take over the stress of dealing with your creditors so you can focus on your health and rebuilding your life. If you are in the South Coast communities of Massachusetts, Hearth Law, PC would be happy to be your choice for Bankruptcy Attorney. We serve the communities of New Bedford, Fall River, Dartmouth, Fairhaven, and more. Call or Email today for a free consultation.
Its a cornerstone of the American Dream, the ability to think up an amazing product or a new service and turn that idea into a business. Reaching this goal takes hard work, a desire to always be on that hustle, and sometimes a little bit of luck. One of the considerations that many entrepreneurs don’t think about is how to structure their business. So you, dear reader, can count yourself among the group of entrepreneurs who prove to have more business acumen than many others by the simple fact that you are reading this blog post and have begun researching what to do. Congratulations, and I hope the basic information below will help you kick off your research. If you would like more information about Business Structures, a recommendation to meet your specific goals, or help with the paperwork to form a business in Massachusetts please feel free to contact us to speak with an attorney conveniently located in New Bedford, Massachusetts who serves the South Coast Communities of Fairhaven, Fall River, Dartmouth, and New Bedford, among others.
The Basics of Business Structures.
One common misconception among entrepreneurs is the idea that all businesses should form as a Limited Liability Corporation (LLC). This business structure became, and remains, a popular one which many adviser’s recommend. However, while this structure has a great deal of benefits to the small business owner, it also contains some pitfalls. The “cookie cutter” approach to Business Structure choice can result in the entrepreneur running into more issues when one of the other structures would be better suited for their goals. Below are the common forms of business entity and a quick look at how they differ regarding liability, taxation, and record-keeping which are three factors that could heavily sway your decision.
A Sole Proprietorship is the most common form of business organization. Formation of a Sole Proprietorship is easy and the entrepreneur retains complete managerial control. However, the entrepreneur is also personally liable for all financial obligations of the business. This liability means that creditors can look to the entrepreneurs personal assets such as her house, car, and bank accounts in order to recover for debts owed from the business.
A Partnership is much the same as a Sole Proprietorship, with the key difference being the involvement of two or more people who agree to share in the profits or losses of the business. The advantages of control and the ease of formation (sometimes too easy) remain in the Partnership structure. Additionally, as with the Sole Proprietorship where the profits and losses of the business pass to the individual and therefore are taxed at the individual level, the Partnership also passes those to the individual partners. Absent a Partnership Agreement the profits and losses pass in equal share, meaning for a partnership of 2 the pass rate is 50/50. The disadvantage, again, is that each partner is personally liable for the financial obligations of the business.
A Corporation is an entity that is created to conduct business and is a separate legal entity from those who founded it. A corporation, like a person, can be taxed and held liable for its actions and financial obligations. The main benefit of a Corporation is that the individuals who create, manage, and operate it can avoid personal liability for the debts that is incurs. The primary disadvantages of a Corporation is that forming one can be costly and involve a number of documents to be properly filed with the Secretary of State, extensive record-keeping requirements and annual filings, and a risk of losing the incorporation status if you don’t fully understand your paperwork and the provisions therein. Corporate taxation can be done in two different ways, as a C-Corp or S-Corp, and with the S-Corp the profits and losses are passed to the individual members of the Corporation similar to the Partnership.
Limited Liability Company (LLC)
The Limited Liability Company (LLC) is a hybrid form of a Partnership and, as discussed above, gained popularity to become a common entity suggestion for new business owners. The advantages of an LLC are that, like a partnership, the profits and losses can be passed through the owners without taxation of the business itself. Additionally the LLC provides the owners with protection from personal liability for the businesses debts. The disadvantages of the LLC are that, like a Corporation, forming an LLC requires documents to be filed with the Secretary of State, record-keeping, and annual filing requirements to maintain the incorporation. The costs for forming an LLC are can sometimes be more than the cost to form a Corporation, but typically there are less documents to maintain. Similar to the Corporation, however, if you are unfamiliar with the requirements or the specific articles of your incorporation you risk losing the incorporation which can result in a legal headache down the road.
When deciding what structure you want to give your business it is important to consider the factors of liability, taxation, and cost. Additionally, don’t buy in to the “cookie cutter” answer many receive that an LLC is always the best option. No two businesses are identical, every business has different needs and different goals. It is important to do your own assessment of your business to determine what it needs now and in the future. It is also a good idea to work with an attorney who is knowledgeable in business formation and operation who can help you reach your goals. If you are in the South Coast Communities of Massachusetts our attorneys at Hearth Law are happy to help you today.
We all think about it at some point in our lives. “I should make a will”. This thought is followed quickly with “I will take care of it later” or “I don’t have any money anyways”. I am here to let you know that there is no time like the present and how wills can do so much more than distribute your money. First let me explain the basics of an estate plan.
The Basic Documents
There are actually several documents that make up a basic estate plan. In Massachusetts there are three basic documents that are a part of most estate plans. They are the Living Will, the Health Care Proxy, and a Power of Attorney. Each document accomplishes a specific task to make sure your friends and family know what to do in case tragedy strikes.
The Living Will
Also called the Last Will and Testament, the Living Will is often the keystone of your estate plan. This document is the one most people think about. It is your chance to outline how you wish to pass your property and money off to others. Things to consider are who will care for your younger children or pets, who you want the house to go to (or how you want the proceeds of the sale of the house to be divided among your children), who gets the heirloom watch that has been passed down in your family, or who you want to take your military medals that you are proud you earned.
This document helps your friends and family by expressing your wishes, which can greatly reduce the chances of disagreements over who gets these items as a keepsake of their loved one (you).
The Health Care Proxy & Power of Attorney
While the Living Will is one that is useful afterwards, the Health Care Proxy, or Advanced Directive, and the Power of Attorney are important documents for when you are still alive. What these documents do is name a person, and often a backup person, who you have decided you trust to make decisions for you if you become incapacitated.
The Health Care Proxy allows the person you have named to make medical decisions in case you are incapable of making those decisions or expressing those decisions yourself. You may also choose to make specific choices known in your Health Care Proxy such as whether you want to be on life-sustaining machines if there is no chance of recovery. This directive placed in the document can make the tough decisions that your family may have to face a little easier by relieving them of the choice.
The Power of Attorney, on the other hand, gives the person that you name the authority to act on your behalf. This allows the person to take care of things, usual financials, for you if you become incapacitated.
All of these documents have important roles in your basic estate plan, as well as some formalities that may need to be followed in order to properly create them. Therefore it can be extremely beneficial to work with an attorney in your area who is skilled in creating these documents.
As explained above, these extremely useful documents can give you and your family piece of mind in knowing that, if a horrible event occurs, you and your possessions are taken care of how you would like them to be. It is not just about who gets the money in your bank account, but also how you would like your remains handled (burial? cremation? turned into a tree?).
The Top 9 Reasons To Make Your Will NOW
- You decide how your possessions will be distributed
- You decide who will take care of your minor children and/or pets
- Your family will be able to probate your estate faster
- You can minimize your estate tax
- You can decide who finalizes your affairs
- You can make gifts and donations
- You can avoid greater legal challenges
- You can always change it
- Tomorrow is never certain
There are more than 9 reasons to have a will, but it can be overwhelming to actually draft a will. While knowing your state’s laws is key, you don’t have to be an expert to write your will. You can contact an estate planning attorney near you who can help you craft these vital legal documents.