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Bankruptcy Attorneys

The Pensacola, bankruptcy lawyers at Whibbs Stone Barnett are available to you to provide advice on the possibility of Bankruptcy protection. Bankruptcy offers several options and the one that is potentially best for you will depend on a number of factors. Whibbs Stone Barnett is here to discuss your factors to determine if Bankruptcy is right for you and if so, which form of bankruptcy filing is best for you and your family.

Pensacola Chapter 7 Attorneys

A Chapter 7 liquidation proceeding is available to individuals, partnerships, and corporations. The debtor is allowed to keep exempt assets. For individuals filing bankruptcy in Florida, the exemptions are primarily determined by Florida law. They include the debtor’s homestead, (subject to a cap of $125,000.00 in equity if owned less than 1215 days), a debtor’s interest, not to exceed $1,000.00 in a single motor vehicle, a debtor’s interest in any professionally prescribed health aids, monies paid into the Prepaid Post-Secondary Education Expense Trust Fund, and $1,000.00 per individual in miscellaneous personal property. Certain other assets such as the cash surrender value of life insurance policies, annuity contracts, IRAs and pension plans may be exempt also. All non-exempt assets must be turned over to the Chapter 7 trustee for liquidation and distribution to creditors.

For individuals filing Chapter 7, most debts, including some tax obligations will be discharged. Some debts such as recent tax obligations, trust fund obligations, child support and alimony generally cannot be discharged. Other debts may not be discharged if the creditor can prove improper conduct on the part of the debtor.

Pensacola Chapter 13 Attorneys

A Chapter 13 bankruptcy, or “wage earner reorganization” is available only to individuals with regular income. It requires that the debtor file a plan providing for payment to creditors over a period of up to five years. The benefits of a Chapter 13 include the ability to reinstate a home mortgage that is in default, stop IRS collection efforts while payments are made, the ability to retain non-exempt real estate and personal assets, and a broader form of discharge.

Pensacola Chapter 11 Attorneys

A Chapter 11 reorganization is available to individuals and businesses. Due to the higher court fees, reporting requirements and legal fees involved in a Chapter 11, it is seldom used by individuals. However, it may provide individuals and businesses with an opportunity to reorganize their debts and make arrangements to pay all or a portion of the debts or sell the business, while obtaining protection from creditors. A Chapter 11 generally provides more flexibility than a Chapter 13 reorganization for individuals.

Dischargeability of Taxes in Bankruptcy

Most individuals are unaware that they may be able to discharge some or all of their older income tax obligations in bankruptcy. Dischargeability of these taxes turns on the question whether or not they are “priority” claims. Tax obligations which are non-priority are dischargeable.

The Bankruptcy Code provides that taxes assessed by a governmental agency which are based on income (income taxes) lose their priority status when:

  1. The tax return, with all extensions, was due more than three years prior to filing for bankruptcy protection
  2. A return was filed at least two years prior to the filing for bankruptcy relief
  3. The tax obligation was assessed at least 240 days prior to filing
  4. The taxpayer is not guilty of fraudulent conduct or tax evasion and has not signed an offer in compromise or other settlement agreement
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