Boston Bankruptcy Lawyer Blog

There were 11,872 Chapter 7 Personal Bankruptcy filings in Massachusetts so far this year. According to new data the number of personal bankruptcy filings in Massachusetts is up 35% percent from January 1 through September 30, 2009. This is compared to the same nine month period in 2008, according to a new report on Massachusetts bankruptcies by The Warren Group, publisher of Banker & Tradesman.

On the other hand, Chapter 13, reorganization bankruptcy filings were down 23% during the same time period.

The Warren Group also has a website which allows you to search for bankruptcy filings in Massachusetts.

When clients call and ask us if they need a will, we almost always reply in the affirmative. Why? Because without a will, your assets will not necessarily go to whom who wish. Further, the Court will appoint an "administrator" and this may not be the person you wanted to carry out your wishes. Finally, tax planning for your assets will be up to the state and the federal government for those without a will.

Some clients report that their assets are minimal. Nevertheless, they often fail to remember life insurance (which can pass outside the will, but should be factored into the plan) and personal injury and wrongful death actions. Some folks report that they have only two children and the Court would split their assets equally anyway. They fail to realize that there could be a fight about who should be the executor and how much that executor should get paid.

Continue reading "Do I Need A Will?" »

Many of our Massachusetts bankruptcy clients who come in for a consultation say that they would be able to pay their bills if only the interest rate on their credit card hadn't jumped so high because of one late payment. The credit card "agreement" they signed has so many clauses that enable the banks to do whatever they wish, when they wish. There are very few contract clauses to help the consumer in these situations.

Harvard University's Elizabeth Warren, who grew up poor in Oklahoma, is a tenured professor at Harvard Law School and has been appointed to chair the Congressional Oversight Panel. She is charged with monitoring the federal bailout of the financial institutions; her task is to examine how they spent the $700 billion bailout. For many years, Ms. Warren has been advocating that we need a few federal agency: the Consumer Financial Product Safety Commission. The model for the new agency is the U.S. Consumer Product Safety Commission, an independent health and safety regulatory agency founded in 1972 by the Nixon Administration. Most folks would agree that this federal agency has added tremendous benefits to society. Since 2001, Canada has a financial products agency, which from all reports seems to be working quite well.

Continue reading "Do We Need a Consumer Financial Product Agency?" »

We recommend that folks in Massachusetts meet with us BEFORE making decisions regarding assets whenever personal bankruptcy is a possibility; even if it is only a remote possibility. This is because with decades of experience in personal bankruptcy we see a theme with respect to mistakes our clients have made.

First, be very careful before transferring real estate. Selling your house is one thing. Transferring ownership to your spouse or child may be a good idea for many reasons. However, it also may be considered a fraudulent conveyance in a number of instances. The federal bankruptcy Trustee that reviews your Personal Bankruptcy Petition and Schedules always asks about real estate transfers. The Registry of Deeds records are public and your testimony is under oath. It is one of the easiest frauds to catch. And, it's almost always unnecessary: your can exempt your home under both federal and state laws in personal bankruptcy.

Continue reading "Seven Personal Bankruptcy Tips BEFORE Bankruptcy in Boston" »

Increasingly, our Massachusetts clients have been asking about conversion strategies between the traditional IRA and the Roth IRA. All monies invested in a traditional IRA are taxable upon distribution to you. That is, whatever you take out of the IRA will be a taxable event and a 1099 will be issued. On the other hand, whatever you withdraw from a Roth IRA is not taxable; this is because you already paid taxes on the amount deposited in the year you made the contribution.

Now, however, there is a planning opportunity for folks with monies in a traditional IRA. If the "modified adjusted gross income" on your 2009 tax return will be less than $100,000, you can "convert" an unlimited amount of your investments in your traditional IRA to a Roth IRA. You will have to pay taxes on the "distribution" and most tax advisors recommend using separate funds to pay those taxes. Nevertheless, the monies can now be invested to grow, tax free to you and your heirs. Thus, as a tax planning mechanism, you can take distributions from the Roth IRA when the tax on traditional IRA would be prohibitive.

Continue reading "Roth IRA Conversions for 2010 Planning" »