Bankruptcy Law

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Involuntary Bankruptcy Process

Involuntary bankruptcy happens when someone or maybe even a business owes money to creditors, and afterwards a creditor requests that the person should file for bankruptcy. The creditor that request for involuntary bankruptcy feels that this is a way that they will collect on funds that should be given to them

How does the automatic stay affect the petitioning creditor? Am I allowed to file suit to get a judgment against the party if I am the one who filed the involuntary bankruptcy? Do I have immunity from the automatic stay that I created?

When things get to this point it is usually the last option in efforts to try and collect a debt, first a person must have a debt that is owed to that person. Also the person must be any kind of issue and the amount can’t go pass $14200.

Also, if that person turns out to be unsuccessful they could end up paying the debtors legal fees instead. To avoid issues it would be good to plan out all other legal means of collecting on the debt by fist obtaining a judgment. And the automatic stay would apply to all creditors including that person and filing a lawsuit would alone defeat the petition as it would show that the debt can be fought.

If a bankruptcy court lost track of an involuntary bankruptcy case and never discharged or dismissed it and the creditors for the case never asked to be released from the automatic stay does the automatic stay remain in effect until someone sees that it's still active?

Yes; automatic stay remains in effect until the creditors file a relief from the automatic stay or until the case is closed or maybe dismissed. The discharge order does not release the Automatic Stay as a case might reopen for one reason or another after the Discharge Order from the Court. There are two ways that would release the Automatic Stay apart from the creditors asking for the relief and being granted the request by the Court and that’s a case dismissal and also if the case was to be closed.

I was put in to involuntary bankruptcy in the state of Florida. The case went now where and was dismissed 4 years later. Do the statue of limitations on debts continue during the 4 years or are they suspended while the bankruptcy was pending?

There are a number of things that may suspend the Statute of Limitations (SOL) for the collection of debts. SOL also shows how the states that are listed have events that are the only ones that can toll the SOL. Bankruptcy don’t get suspended though. In addition to that, the Statue of Limitations is not suspended while the Bankruptcy is in progress.

A couple is getting ready to look into filing bankruptcy in the state of CA. 1) Can state income tax debts qualify? 2) If bankruptcy is granted, do I have to pay taxes on the amount of debt that is discharged? 3) What is the average cost of filing? 4) Can I keep my home out of the bankruptcy?

A person can’t discharge income tax debts. Also, the person doesn’t have to worry about paying taxes on the debt that has been discharged. A Chapter 7 will cost $306 to file, and it would be lower to file a Chapter 13 costing $281 to file. Lawyer fees will be more costly it would be around $1500 for a Chapter 7, and about $3500 for a Chapter 13; those prices are not exact. They are just estimates of what a person may pay for lawyer fees. In order to keep property, a person would need to keep payments current with the house. If that is handled properly, then there should be no problem keeping with keeping the home.

Having the right information about involuntary bankruptcy can help individuals deal with difficult situations and make the right decisions. Ask Experts about involuntary bankruptcy and other related topics.
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