Recent changes in U.S. law made declaring Bankruptcy a much more complicated matter. Chapter 7 is the most common form of bankruptcy requested by debtors and does not require repayment. However, the U.S. Trustee has become much more aggressive in denying Chapter 7 bankruptcy, and instead forcing people into a Chapter 13 bankruptcy that does require repayment. Today you need much more from your law firm to get your Chapter 7 petition approved. Under the new regulations, the government requirements to obtain a Chapter 7 bankruptcy are: # Obtaining a Special Edition Credit Report of your obligations # Transferring your accounts to collection agencies # Third-party assignees and if any judgments have been obtained against you # Obtaining a copy of your IRS Tax Transcripts # The Pre-Filing Credit Class # Performance and certification of the Financial Means Test # Preparation and filing of your petition # Payment of all court filing fess; # Representation at court hearings (as known as the Meeting of Creditors) # A copy of your officially filed bankruptcy petition # The Post-Filing Credit Class. Arguably the most difficult and the most critical part of the Chapter 7 process is the new "means test." The means test compares the debtor’s income in the six months before the filing of the bankruptcy to their state’s median income. If the debtor’s income falls below the state median, they are automatically allowed to file for bankruptcy under Chapter 7. If the debtor’s income is above their state’s median income, they may still qualify to file for Chapter 7, but it becomes more complicated process with additional tests that take their expenses and excess income into account. Another crucial step in getting your Chapter 7 bankruptcy petition approved is the "341 creditors meeting." The meeting with 341 creditors takes place one to three months after the bankruptcy petition is filed, which allows creditors the chance to gain additional information about the debtor’s finances and ability to repay his debt. While you are not required to have a bankruptcy attorney, it is important to make sure you are prepared properly for the meeting. Considering both- the new and the old requirements, it may be in the best of interests of a debtor to hire a law firm that has both- Bankruptcy lawyers and a Professional Accountant. At Storobin & Spodek LLP, we made a decision to hire Joel Lewis, a Certified Public Accountant and a former IRS auditor because we believe that it would be beneficial to our clients. We recommend to all people who are in financial trouble to speak to both- the lawyer and the accountant about their options.
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