Archives for March 2017

Bankruptcy and Business Litigation

When you own or operate a business venture, you know that legal challenges are often a cost of doing business. A bankruptcy petition can offer some benefit in the midst of a business dispute. If you are involved in a dispute that threatens the viability of your business, but the long-term prospects are good, you can use the bankruptcy laws to minimize the impact of litigation. If, on the other hand, your business has little chance of success, a Chapter 7 liquidation proceeding can be the most effective way to shut down business operations.

The Advantages of Filing a Bankruptcy Petition

The first, and perhaps most powerful benefit you get when you seek protection in bankruptcy is the automatic stay. With the automatic stay, you have the power of the bankruptcy court behind you, prohibiting creditors from calling you, writing you, taking legal action against you or using any means other than the bankruptcy proceeding to collect the debt from you. A creditor can petition the bankruptcy court to lift the automatic stay, but such a request is rarely granted, provided you don’t engage in fraud or misrepresentation, and that honor your commitments in the bankruptcy process.

If you plan to close your business, your best option is a Chapter 7 filing. However, if you need temporary relief, but believe that your business has long-term potential, you may want to proceed under Chapter 11. A Chapter 11 petition allows you to restructure or renegotiate your debt, so that it becomes affordable. You’ll have to submit a reorganization plan, which must be approved by your creditors and by the court.

Contact Neuner & Ventura, LLP

We understand the stress, anxiety and confusion that can be associated with a potential bankruptcy filing. We offer a free initial consultation to every client. For an appointment, call Neuner & Ventura at 856-596-2828 or send us an e-mail. We do, however, reserve the right to charge a fee to review any work done by another attorney. Evening and weekend appointments are available upon request.

Representing Clients across South Jersey

How Does the Means Test Work?

If you are thinking about filing for personal bankruptcy protection, one of your first decisions will be whether to seek to permanently discharge debt under Chapter 7 or to try to reorganize your debt under Chapter 13. Pursuant to the changes made to the bankruptcy laws more than a decade ago, much of that decision is taken out of your hands now, as you must submit to a “means test” in order to qualify for Chapter 7 bankruptcy protection. The purpose of the means test is to ascertain whether you will have the financial resources to repay your creditors over a three to five year period. If so, you won’t be able to pursue Chapter 7.

The means test is essentially a formula that ensures that anyone with sufficient income repay debts rather than having them wiped out. To make that determination, the means test looks at your “current monthly income,” i.e., your average income for the six months immediately prior to filing your petition. The test will also look at your expenses to determine how much “disposable” income you have. The more disposable income, the greater the likelihood that you’ll prohibited from filing Chapter 7. The income limits vary from state to state.

Before looking at your disposable income, though, the test compares your “current monthly income” with the median income for a household of your size in your state. If your current monthly income is below that median, you’ve passed the test and can file for Chapter 7 protection.

If, however, your currently monthly income is above the median, you must determine if you have enough disposable income to repay your debts. To make this calculation, you subtract any “allowed” monthly expenses to come to your disposable income.

Contact Neuner & Ventura, LLP

At Neuner & Ventura, LLP, we provide a free initial consultation to every client. To set up a meeting, call Neuner & Ventura at 856-596-2828 or send us an e-mail. We do, however, reserve the right to charge a fee to review any work done by another attorney. Evening and weekend appointments are available upon request.

Representing Clients across South Jersey

What Constitutes Bankruptcy Fraud

The bankruptcy laws are in place to help honest folks get a fresh start after circumstances present them with financial challenges. As long as you follow the rules, you won’t have any problems. There are, however, a number of ways that you can run afoul of the bankruptcy rules. If your actions are determined to be intentional, you may even face criminal charges.

Here are some of the most common ways people commit bankruptcy fraud:

  • Hiding assets or income or failing to include all property on the application for bankruptcy protection
  • Destroying, withholding or falsifying any documents related to income or assets, or that would have an effect on the disposition of the bankruptcy
  • Setting up a straw, or sham, transfer of property, such that you still retain control and use of the property, even though it appears you no longer own it—for example, you may “give” a boat or vehicle to a friend or family member, but still use it on a regular basis. Often, this involves property “given” before the bankruptcy, so that you don’t have to report it on your application.
  • Creating any type of false document related to your income, debt or assets
  • Paying a third party to hide, destroy or disguise assets
  • Making any type of false representation to the bankruptcy court or as part of the bankruptcy process

There are serious penalties for engaging in bankruptcy fraud. If convicted of certain crimes, you can face up to 20 years in prison and as much as $250,000 in fines.

Contact Neuner & Ventura, LLP

At Neuner & Ventura, LLP, we know that the bankruptcy process can be intimidating and confusing. We offer a free initial consultation to every client. For an appointment, call our office at 856-596-2828 or send us an e-mail. We do, however, reserve the right to charge a fee to review any work done by another attorney. Evening and weekend appointments are available upon request.

Representing Clients across South Jersey

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