The National Rifle Association likes guns. Texans like guns. Therefore, when the NRA decided to file bankruptcy, there was a certain logic to filing in Texas. Unfortunately, however, prior to November 24, 2020, the NRA had no legal right to file bankruptcy in Texas. This did not deter the gun rights advocates. They created one.Let me explain how this works. Under the bankruptcy venue statute, 28 U.S.C. Sec. 1408(a), a debtor can file bankruptcy in its domicile, residence, principal place of business or where its principal assets in the United States were located during the preceding 180 days. The NRA did not meet any of these tests. It is incorporated in New York. Its principal place of business and presumably principal assets are located in Virginia. However Sec. 1408(b) offers a loophole. A company can file in a district where a bankruptcy by one of its affiliates is pending. An affiliate includes a company owned by the debtor.Prior to November 24, 2020, the NRA could not have filed in Texas under affiliate venue either. So, on that day, less than sixty days before filing bankruptcy, the NRA created a Texas affiliate called Sea Girt, LLC. Sea Girt, LLC filed bankruptcy first and was assigned Case No. 21-30080. It did not list any creditors, which is not surprising for an entity created so recently. A few minutes later, the National Rifle Association filed its case and was assigned Case No. 21-30085.This is a clear case of forum shopping. Indeed, a statement from the NRA said that it was trying to escape the "toxic political environment of New York." In an article in USA Today, Bankruptcy Prof. John Pottow speculated that the company might be attempting to obtain a judge who would be Second Amendment friendly. The judge assigned to the Sea Girt case is Harlan "Cooter" Hale. The judge assigned to the NRA case is Stacy Jernigan. The two cases will likely be consolidated under one of the judges. However, either judge is a straight shooter who may question whether the choice of venue was a misfire. I make no predictions about how the judge will deal with a politically charged debtor who is transparently attempting to manipulate the rules on venue. However, I do note the irony here. In 2001, Texas-based Enron filed bankruptcy in New York based on a filing by an obscure affiliate. Now the New York based NRA is attempting to do the same thing in Texas.  

Bankruptcy Filing Guide: Will I Lose My Rental Property? Options to Get Debt Relief Through Bankruptcy Protection When you’re ready to file for bankruptcy, you are likely struggling so much to handle your financial obligations that you don’t want to have to give up any of the things you have going well for you – like the house you’ve been paying on and building equity or the rental property that’s actually been generating a bit of income for you. Don’t let fears that the few assets you do have will be seized to satisfy your creditors if you file for bankruptcy. Talk to a Phoenix bankruptcy lawyer to better understand how the rules will apply to your specific situation. Chapter 7 Bankruptcy If you file for Chapter 7 bankruptcy in Mesa, you are allowed to keep some of your assets. Bankruptcy law allows you to keep a certain amount of equity in your property. So, if you own a house, you don’t have to worry about losing the house if you haven’t built up that much equity in it. Rental property is different. It is not included in the exemption. However, it may still be safe from your creditors if you don’t have much equity in it. Creditors are going to have to spend money to seize and sell your property, and if the cost of doing that is more than what they are going to get for it, they likely won’t bother. The same is true if the amount would be a net positive, but not a very big one. Alternately, your Mesa bankruptcy attorney may advise you to use the wildcard exemption to protect your rental property. This exemption can apply to any personal property up to a certain amount. Your attorney will let you know how much it is and how it can be applied. Chapter 13 Bankruptcy You have a lot more flexibility when you file for Chapter 13 bankruptcy in Phoenix. You don’t have to meet any standards for income, and you don’t have to give up any property. You can hold onto your house and your rental property. Under a Chapter 13 bankruptcy filing, you restructure your debts under a repayment plan that the court determines you are able to afford. The repayment period lasts three to five years, and you make only one monthly payment that the court distributes among your creditors. You may end up paying less in interest and fees, and you could even have some of your debts discharged at the end of the repayment term. If you are struggling to pay the mortgage on your rental property, Chapter 13 bankruptcy has additional benefits. The repayment plan can help you to get current on what you owe so that the property does not go into foreclosure. If you have taken out a second mortgage on the property and the amount you owe is now worth more than the property itself, you may be able to “cram down” the mortgage – meaning that the amount you owe over the actual value of the property could be discharged. You can get the property back to an affordable level, helping you to get a better handle on your debt and start turning a profit on the rent. You have a lot of options to get debt relief through bankruptcy protection without having to give up assets such as your home or a rental property. A bankruptcy attorney in Phoenix can help you understand the best course of action to take to get the maximum debt relief available while also protecting the assets you want to keep. With the right attorney on your side, you can put together a filing that will help you get huge debt relief fast. Call My AZ Lawyers today to talk with an experienced bankruptcy attorney about your options. We represent individuals in both Chapter 7 bankruptcy and Chapter 13 bankruptcy cases. A bankruptcy lawyer will discuss your goals and your concerns and analyze your finances to help you determine the best path forward. Once the right strategy is determined, your attorney will put together a strong and thorough filing to help you get a fast resolution. Our goal is to help you get out from under the crushing weight of your debt so you can rebuild your finances quickly. Call us in Phoenix today to schedule a consultation. Arizona Offices: Mesa Location: 1731 West Baseline Rd., Suite #100 Mesa, AZ 85202 Office: (480) 448-9800 Email: info@myazlawyers.com Website: https://myazlawyers.com/ Glendale Location: 20325 N 51st Avenue Suite #134, Building 5 Glendale, AZ 85308 Office: (602) 509-0955 Tucson Location: 2 East Congress St., Suite #900-6A Tucson, AZ 85701 Office: (520) 441-1450 Avondale Location: 12725 W. Indian School Rd., Ste E, #101 Avondale, AZ 85392 Office: (623) 469-6603 The post Bankruptcy Filing Guide: Will I Lose My Rental Property? appeared first on My AZ Lawyers.

 The Supreme Court decided that a creditor which passively retains possession of estate property does not "exercise control" over such property in violation of 11 U.S.C. Sec. 362(a)(3). The Court viewed the word "exercise" to require active measures.  Case No. 19-357, Chicago v. Fulton (1/14/21), which can be found here. In the Fulton case, the City of Chicago impounded the Debtor's vehicle over failure to pay fees. The Debtors (there were multiple consolidated cases) filed chapter 13 and demanded return of their vehicles. The City refused. The Seventh Circuit held that the refusal to relinquish possession was a violation of the automatic stay.Ruling from Judge Webster Alas, the Supreme Court read some dictionary definitions and ruled against the Debtors. After consulting Webster's New International Dictionary, the Court found that the words "act," "exercise" and "control" as used in Sec. 362(a)(3) were all words connoting action. The Court found that "362(a)(3) halts any affirmative act that would alter the status quo as of the time of the filing of a bankruptcy petition." Opinion at 4. Thus, if the City had placed a boot on the Debtor's car prior to bankruptcy and left it there after filing, there would be no violation. However, if the City placed the boot on the car after the filing date, that would be a change in the status quo. The Court did not reach the issues of how Sec. 542 would apply to the situation or whether the City's actions could have violated another subsection of Sec. 362.The Tears of Justice Sotomayor Justice Sotomayor wrote a sympathetic concurrence. She stated that "I agree that, as used in §362(a)(3), the phrase “exercise control over” does not cover a creditor’s passive retention of property lawfully seized prebankruptcy." She held out the hope that other provisions might apply.I write separately to emphasize that the Court has not decided whether and when §362(a)’s other provisions may require a creditor to return a debtor’s property. Those provisions  stay,among other things, “any act to create, perfect,or enforce any lien against property of the estate” and “any act to collect, assess, or recover a claim against [a] debtor” that arose prior to bankruptcy proceedings. §§362(a)(4), (6).She also noted that while the Court's result "satisfies the letter of the Code, it hardly comports with its spirit." She pointed out the difficulty in filing a turnover action which often must be done by adversary proceeding which takes an average of one hundred days. She recognized that:(W)ithout their vehicles, many debtors quickly find themselves unable to make their Chapter 13 payments. The cycle thus continues, disproportionately burdening communities of color, see Brief for American Civil Liberties Union et al. as Amici Curiae 17, and interfering not only with debtors’ ability to earn an income and pay their creditors but also with their access to childcare, groceries, medical appointments, and other necessities.She concluded with a call to action. Ultimately, however, any gap left by the Court’s ruling today is best addressed by rule drafters and policymakers, not bankruptcy judges. It is up to the Advisory Committee on Rules of Bankruptcy Procedure to consider amendments to the Rules that ensure prompt resolution of debtors’ requests for turnover under §542(a), especially where debtors’ vehicles are concerned. Congress, too, could offer a statutory fix, either by ensuring that expedited review is available for §542(a) proceedings seeking turnover of a vehicle or by enacting entirely new statutory mechanisms that require creditors to return cars to debtors in a timely manner.What It MeansThis case is a benefit for small, unsophisticated creditors who might not know what to do when faced with a demand from a bankruptcy debtor. The ruling also helps creditors dealing with bad actors. For example, if a creditor repossessed a vehicle after the debtor was arrested for driving drunk and without a license or insurance, it might feel reluctance to give the car back. In Circuits which followed the Seventh Circuit rule, the creditor would need to file an emergency motion to annul the automatic stay in order to retain possession. While this encourages creditors to maintain a relationship with a competent bankruptcy lawyer, it is still burdensome.On the other hand, the burden to the debtor who is not a bad actor and who needs the vehicle to get to work at a factory making Covid-19 vaccines, there is a definite burden.The Supreme Court's coy ruling that, well Sec. 362(a)(3) doesn't work, but maybe you could try something else is not very satisfying.  Justice Sotomayor has the right idea. What is needed is an efficient, expedited procedure for good debtors to get their cars back and for good creditors to receive clear direction as to their obligations. I predict that this will bubble up in the form of local rules until the national rules committee or Congress finds a fix.    

In short, the answer is: “PROBABLY NOT!”  Under current Pennsylvania law, police can now no longer search a vehicle unless they have two (2) things: probable cause AND exigent circumstances. Probable Cause & Exigent Circumstances In the year 2014, Pennsylvania underwent a drastic change in its law on allowing police officers to search a vehicle […] The post Can Police Search Your Home or Car Without a Warrant in Pennsylvania? appeared first on .

If you have an upcoming Social Security Disability hearing in Pennsylvania or New Jersey, it means that you have been denied both initially and on Reconsideration.  Don’t be alarmed! Your greatest chance of success comes at this level.  Statistically, more people are granted benefits at the hearing level than at any of step in the […] The post What to Expect at a Disability Hearing in Pennsylvania or New Jersey appeared first on .

As Covid-19 forced lockdowns across the nation, unemployment skyrocketed, and many industries screeched to a halt as the Gross Domestic Product fell by more than 30 percent in the second quarter of 2020. Despite the bleak economic situation, some economic data like bankruptcies and delinquent mortgages would tell a different story if you took it […] The post The Effects of Covid-19 on Bankruptcy Filing and Mortgage Foreclosures appeared first on .

The short answer to this question is yes. Any individual can file a bankruptcy case on their own, even if they are married. In a situation like this, the other spouse is usually referred to as the “non-filing spouse” in the case, and their involvement is limited. However, whether or not filing without your spouse […] The post Can a Husband File For Bankruptcy Without Their Wife in Pennsylvania? appeared first on .

The timing of when a bankruptcy case might be the best option can vary depending on your circumstances, as well as intentions with your home. For those looking to stop the foreclosure process altogether and get their mortgage payments back on track, a Chapter 13 Bankruptcy is usually the method to do so, and the […] The post Should You File For Bankruptcy Before or After a Foreclosure in Pennsylvania? appeared first on .

 $600 stimulus (actually advance on tax credit) not subject to assignment/levy. Note, substantial condensing of section, but I believe this is the answer."SEC. 6428A. ADDITIONAL 2020 RECOVERY REBATES FOR INDIVIDUALS."(a) In General.--In addition to the credit allowed under section 6428, in the case of an eligible individual, there shall be allowed as a credit against the tax imposed by subtitle A for the first taxable year beginning in 2020 an amount equal to the sum of--"(1)$600 ( $1,200 in the case of eligible individuals filing a joint return), plus"(2)an amount equal to the product of $600 multiplied by the number of qualifying children (within the meaning of section 24(c)) of the taxpayer."(b) Treatment of Credit.--The credit allowed by subsection (a) shall be treated as allowed by subpart C of part IV of subchapter A of chapter 1."(c) Limitation Based on Adjusted Gross Income.--The amount of the credit allowed by subsection (a) (determined without regard to this subsection and subsection (e)) shall be reduced (but not below zero) by 5 percent of so much of the taxpayer's adjusted gross income as exceeds--"(1)$150,000 in the case of a joint return or a surviving spouse (as defined in section 2(a)),"(2)$112,500 in the case of a head of household (as defined in section 2(b)), and"(3)$75,000 in the case of a taxpayer not described in paragraph (1) or (2)."(d) Eligible Individual.--For purposes of this section, the term `eligible individual' means any individual other than--"(1)any nonresident alien individual,"(2)any individual with respect to whom a deduction under section 151 is allowable to another taxpayer for a taxable year beginning in the calendar year in which the individual's taxable year begins, and"(3)an estate or trust."(e) Coordination With Advance Refunds of Credit.--"(1) In general.--The amount of the credit which would (but for this paragraph) be allowable under this section shall be reduced (but not below zero) by the aggregate refunds and credits made or allowed to the taxpayer under subsection (f). Any failure to so reduce the credit shall be treated as arising out of a mathematical or clerical error and assessed according to section 6213(b)(1)."(2) Joint returns.--Except as otherwise provided by the Secretary, in the case of a refund or credit made or allowed under subsection (f) with respect to a joint return, half of such refund or credit shall be treated as having been made or allowed to each individual filing such return."(f) Advance Refunds and Credits.--"(1) In general.--Each individual who was an eligible individual for such individual's first taxable year beginning in 2019 shall be treated as having made a payment against the tax imposed by chapter 1 for such taxable year in an amount equal to the advance refund amount for such taxable year."(2) Advance refund amount.--For purposes of paragraph (1), the advance refund amount is the amount that would have been allowed as a credit under this section for such taxable year if this section (other than subsection (e) and this subsection) had applied to such taxable year. For purposes of determining the advance refund amount with respect to such taxable year--"(A)any individual who was deceased before January 1, 2020, shall be treated for purposes of applying subsection (g) in the same manner as if the valid identification number of such person was not included on the return of tax for such taxable year, and"(B)no amount shall be determined under this subsection with respect to any qualifying child of the taxpayer if--"(i)the taxpayer was deceased before January 1, 2020, or"(ii)in the case of a joint return, both taxpayers were deceased before January 1, 2020."(3) Timing and manner of payments.--"(A) Timing.--"(i) In general.--The Secretary shall, subject to the provisions of this title, refund or credit any overpayment attributable to this subsection as rapidly as possible....d) Administrative Provisions.--(1) Exception from reduction or offset.--Any refund payable by reason of section 6428A(f) of the Internal Revenue Code of 1986 (as added by this section), or any such refund payable by reason of subsection (c) of this section, shall not be--(A)subject to reduction or offset pursuant to section 3716 3720A of title 31, United States Code,(B)subject to reduction or offset pursuant to subsection (c), (d), (e), or (f) of section 6402 of the Internal Revenue Code of 1986, or(C)reduced or offset by other assessed Federal taxes that would otherwise be subject to levy or collection.(2) Assignment of benefits.--(A) In general.--The right of any person to any applicable payment shall not be transferable or assignable, at law or in equity, and no applicable payment shall be subject to, execution, levy, attachment, garnishment, or other legal process, or the operation of any bankruptcy or insolvency law.

 FICO and Personal Bankruptcy When clients contact me for a consultation with respect to a personal bankruptcy filing, they will often ask how this could impact their FICO score. My reply is that the impact of a filing on their FICO score is of secondary importance; how to rehabilitate their credit after filing, is of primary importance.A wonderful article regarding one’s FICO score was recently published at Groovy Post and can be found at:     https://www.groovypost.com/explainer/what-is-a-fico-score-why-important/?utm_source=newsletter&utm_medium=email&utm_campaign=daily Reader’s with questions regarding FICO should review this post.Generally, a bankruptcy filing results from a “triggering event” such as being sued, losing a lawsuit and being subject to a judgment, failure to make a payment on credit cards, or defaulting on car lease payments. A person contemplating a bankruptcy filing usually has a FICO score of 550 to 650 and is unable to get credit.Accordingly, a chapter 7 bankruptcy filing would not lower the FICO score since it is already low. However, a chapter 7 bankruptcy filing can increase a person’s ability to obtain credit. Yes, let me repeat, a chapter 7 filing can make a person more credit-worthy. Why? For two reasons: 1) one can only file for chapter 7 bankruptcy once every eight years and 2) the bankruptcy filing cleans up one’s personal balance sheet: liabilities are discharged in and exempt assets are kept.Banks are aware of these factors and are thus more likely to loan money to a debtor after a bankruptcy filing with credit rehabilitation than before a filing.So how does a debtor rehabilitate their credit? 1) By getting a secured credit card, charging the card and repaying it, and finally asking the bank or credit card company to increase their credit limit. 2) By working, reducing their expenses, and saving as much money as possible.For these reasons, filing for bankruptcy and rehabilitating one’s credit is more important than the impact of chapter 7 bankruptcy on one’s FICO score.People with questions regarding FICO and credit rehabilitation should contact:Jim Shenwick, jshenwick@gmail.com, (212) 541-6224