Archive for February, 2010
Why Your Tax Forms Are So Important to Your Attorney
When you work with an attorney on a bankruptcy filing, there’s a long list of documents you’ll be asked to gather and give to your attorney. Some of the most critical documents you’ll gather are your last three years’ worth of tax filings, both state and federal. Why are these so important?
First, and most important, tax returns contain a great deal of the financial information that your attorney will use when preparing your bankruptcy petition. Your attorney will review your returns to get a good foundational grasp of your financial situation—what real estate you own and whether it’s investment property; what bank accounts or investments you may hold; whether you are self-employed and how the business has been doing over time, and so on.
Similarly, your attorney uses your tax returns as a kind of financial checklist when preparing your bankruptcy petition. Most of the information that you’ve already reported on your tax returns is information that your attorney must include in your petition.
Importantly, bankruptcy is information-based. In other areas of law, when you go to court, you may be asked to testify and tell your side of the story. At your bankruptcy hearing, your bankruptcy petition—the specialized financial report that your attorney has presented to the court for approval—tells your story for you. The bankruptcy trustee who examines your petition may ask some questions, but the more accurate and detailed your attorney’s information, the easier it is for the bankruptcy trustee to review and approve your petition.
So don’t flinch when your attorney asks for copies of your tax returns. You can share them confidently, knowing that your attorney is helping you toward bankruptcy’s “fresh financial start.”
The forgoing post was drafted by Marsha Graham and Liz Weishaar who have both been heard on the Consumer Debt Radio Show and work in an of counsel relationship to The Law Office of Goldstein and Clegg, LLC as well as for the Law Office of Weishaar and Graham.
Protecting debtors from failure to hire, promote or termination after filing bankruptcy
The stigma of filing bankruptcy has stopped many debtors who rightfully and propably necessarily need to file bankruptcy. The truth of the matter is that filing bankruptcy is a right granted to all Americans by Congress and as such, is a protected right. As a protected right, it is illegal to discriminate against debtors as employees pursuant to both Massachusetts law, MGL 151B, and Federal Law (Civil Rights Act and Bankruptcy Code). More specifically, 11 U.S.C.A § 525(b) provides, “No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or bankrupt under the Bankruptcy Act, or an individual associated with such debtor or bankrupt, solely because such debtor or bankrupt”.
There has been several cases directly on-point with the forgoing. In one case, a Police department rule rendering a city policeman subject to dismissal for the filing of a petition in bankruptcy was unconstitutional under U.S.C.A.Const. Art. 6, cl. 2, since the rule, while intended to insure a reliable and respectable police force, had the effect of prohibiting a policeman burdened with staggering debts from obtaining “a new opportunity in life and a clear field for future effort, unhampered by the pressure and discouragement of pre-existing debt”, an effect in direct contravention of the stated purpose of this title. Rutledge v. City of Shreveport, W.D.La.1975, 387 F.Supp. 1277.
Chapter 13 debtor, a former chief appraiser for a county tax appraisal district, was fired from her job in violation of the Bankruptcy Code’s antidiscrimination provision where it was apparent from the totality of the circumstances that appraisal district’s board of directors determined that debtor would be discharged because they were embarrassed that she had filed bankruptcy and that it had become public knowledge. In re McKibben, Bkrtcy.E.D.Tex.1999, 233 B.R. 378.
Pursuant to Federal and state law, it is also a violation of law to either refuse or fail to promote or hire an employee based upon their status as a bankruptcy filer. In one case, an employer’s failure to offer participation to debtor in commission advancement program after debtor had filed for bankruptcy, when all other account specialists were offered participation, violated antidiscrimination provision of Bankruptcy Code, where determining reason for failing to offer participation to debtor was fact of his bankruptcy. In re Vaughter, bkrtcy.W.D.Tex.1989, 109 B.R. 229.
