Declaring bankruptcy is one of the many options a debtor can perform when he can no longer meet the terms of his financial obligations to his creditors. In the United States of America, bankruptcy is governed by the US constitution and the Congress has enacted laws that will govern the procedures in the filing of bankruptcy. Some of these laws were short lived. However, there is now a uniform federal law  pertaining to bankruptcy which is now an emerging trend in the US. It is no longer considered shameful to file a petition for bankruptcy. Individuals can file bankruptcy under Chapter 7 or Chapter 13 of the Code.If the debtor files under Chapter 7, he surrenders his non-exempt properties to a trustee who shall liquidate and distribute the properties to the creditors while under Chapter13, the debtor retains ownership of his properties but must give a portion of his future income to his creditors.

In filing a bankruptcy which is frivolous and for the sole purpose of evading  financial obligations, there are legal implications and can be considered a bankruptcy crime under the provisions of Title 18 of the United States Code. There are also tax implications attached in the filing a bankruptcy and this is governed by the US Internal Revenue Code.

There is also a law that was enacted to prevent the abuses committed by debtors in filing bankruptcy to the detriment and prejudice of the creditors. To address these abuses, Congress enacted the Bankruptcy Abuse Prevention and Consumer Protection Act in 2005.

In filing a bankruptcy, the debtor is allowed to retain properties with sentimental value. There are also assets which are protected from being garnished by the creditors such as social security payments, books and unemployment compensation. The tools used in the trade are also exempt.

Related Posts
The landlord’s right in evict tenants
Every state in US has the unique Rent Control Acts and this is to be protected in the right manner surely. There should indeed be a valid reason behind everything ...
READ MORE
Tenant Rights and responsibilities
Have you recently moved out and you’ve decided to move again into a rented residential unit? Did you know that the tenant rights made by the Federal and State bodies ...
READ MORE
Renting Office Space: Know What’s Involved
Office spaces are efficient for business owners and entrepreneurs to run their operations. Sometimes, sharing these commercial spaces with another person in the same line of profession or business is ...
READ MORE
Child Abuse
Kid misuse is the actual, sex-related or emotional maltreatment or ignore of kids or kids. In the United States, the Centers for Disease Control and Prevention (CDC) and the Department ...
READ MORE
DWI: Driving while intoxicated
Operating  or driving a motor vehicle while under the influence of alcohol or drugs that impair your driving skills and perception is a crime in the United States which is ...
READ MORE
Risks and Benefits of buying a foreclosed property
Buying foreclosure property may give you great discounts; however, there are various underlying risks to it too. Benefits Pre-foreclosure home owners want to sell their houses in a hurry to avoid foreclosure, ...
READ MORE
Bankruptcy
Bankruptcy laws are made for the help of the people who can no longer pay their creditors get a chance to pay that is by liquidating assets or by creating ...
READ MORE
Got notice of eviction even before due date of rent agreement – WHAT TO DO
Your landlord cannot end your tenancy without a good cause and especially without the blessing of the court. If you have received a notice of termination even before the due ...
READ MORE
Common Commercial Lease Terms
The commercial lease clauses are the written and binding agreement on the real estate you will rent for your business. It will help you avoid trap and negotiate for bargains ...
READ MORE
Too many people living in single rental unit….what to do?
Defining how many people can live in a rental unit is one of the biggest problems that some landlords have to face. The legally defined specifics vary per state. This ...
READ MORE
The landlord’s right in evict tenants
Tenant Rights and responsibilities
Renting Office Space: Know What’s Involved
Child Abuse
DWI: Driving while intoxicated
Risks and Benefits of buying a foreclosed property
Bankruptcy
Notice of eviction before due date of rent
Common Commercial Lease Terms
Too many people living in single rental unit….what