What to Bring to the Initial Bankruptcy Consultation

Your first consultation with a bankruptcy attorney will cover a lot of ground, and the goal is for you leave with all the information needed to decide whether bankruptcy is right for you and what your non-bankruptcy options may be. A productive Chapter 7 or Chapter 13 bankruptcy consultation will mean that you should plan to bring several important documents and other important information with you to your consultation.

The documents you should plan to bring include:

  • Credit report. Free credit reports are available online from annualcreditreport.com. Also bring a list of creditors that do not appear on your credit report, such as loans from family members or other private individuals and statements of past due taxes.
  • Driver’s license and social security card.
  • Paystubs for the last seven months. The purpose of bringing so many paystubs is so we can determine if you qualify for Chapter 7 or Chapter 13 bankruptcy, which is largely income based and calculated according to the means test.
  • Deed to your home. If you file bankruptcy, we want to list the exact legal description of your home so in the future there won’t be any issues because it was incorrectly described in your bankruptcy papers. Note that the property tax statement only has an abbreviated version so be sure to bring the actual deed.
  • Recent mortgage and car loan statements.
  • Tax returns for the last two years including W-2s. This information will be listed in your bankruptcy schedules and also will need to be provided to the trustee assigned to your case.
  • Copies of bank statements, recent retirement plan statements, cash value life insurance statement (if applicable), copies of any leases or contracts you are party to, recent stock brokerage account statement, foreclosure
    , divorce decree in the past 5 years, etc. These are all required for the purpose of confirming what assets can be protected under the bankruptcy exemptions and various other issues that may be involved in a bankruptcy.
  • Recent lawsuits, notice of judgments, garnishment notices, etc. (if applicable).

Just like all other legal proceedings, bankruptcy is a paperwork-heavy process. The documents above are a solid starting point for your bankruptcy attorney to fully evaluate your circumstances and give you the most options.  

Contact Wartchow Law Office for a free Chapter 7 or Chapter 13 bankruptcy consultation.

Recognize the Circumstances that Often Lead to Chapter 11

The factors commonly precipitating a Chapter 11 business proceeding are numerous: lawsuits filed by unsecured creditors, reluctance of secured lenders to extend or continue financing terms, attachment of business assets including bank account levies, foreclosure or repossession of key assets used in business, adverse administrative actions such as license posting by the state, aggressive tax collection, a commercial eviction proceeding and the list goes on.

Businesses are often cyclical in their financial condition, and experience financial highs and lows the same as individuals. Not every ailment justifies the time and expense of a Chapter 11 business proceeding, and an experienced and principled Chapter 11 attorney can advise if that is the case for your business. Sometimes, however, a situation that warrants Chapter 11 is a “one-off” of sorts: an unexpected lawsuit or judgment brought against the business, an isolated but escalating event such as an eviction proceeding or sales tax audit, or a recurring temporary circumstance that the business just  can’t get out from under.  In situations such as these, the expense of a Chapter 11 may be justified since it provides both immediate relief and a permanent solution.

Chapter 11 opens the door to new avenues of relief that are not available outside of the context of bankruptcy. As a simple yet common example to many small businesses, the nonpayment of sales tax can effectively put a business out of business in as little as a few months. The Minnesota Department of Revenue, charged with collecting revenue to offset the State’s huge deficit, is necessarily aggressive in the collection of sales tax and provides extremely little, if any, breathing room for businesses that cannot immediately pay delinquent tax obligations. Unpaid sales tax quickly threatens any business. Outside of bankruptcy, unpaid sales tax can result in license posting and a revocation of sales tax permit that is tantamount to the death of operations, as well as the pursuit of personal liability against principals of the business. Inside Chapter 11, by contrast, unpaid sales or withholding taxes can be statutorily repaid over five years at low interest, and often personal collection is put on hold while the business reemerges under a confirmed Chapter 11 plan.

Keep reading for more information about Sales Tax Obligations and Chapter 11 Reorganization and Commercial Leases and Chapter 11 Reorganization: The Requirements and Timelines under the Bankruptcy Code.

Read some of the recent Chapter 11 success stories handled by Wartchow Law Office.

Lynn Wartchow is a Chapter 11 attorney located in Edina, MN. Contact Wartchow Law Office for an initial Chapter 11 consultation to review business liabilities and other circumstances affecting a Chapter 11 bankruptcy proceeding, and for guidance on options and solutions that Chapter 11 can provide to keep a business operating and improve future prospects.