Our Legal Blog

Financial support for children is of primary importance, and Kentucky gives child support obligations priority in any bankruptcy proceeding. Filing for Chapter 13 or Chapter 7 personal bankruptcy will not discharge child support arrearages or put a stop to a payee’s obligation to continue monthly payments. It is very important for child support, as well as alimony payments, to continue throughout bankruptcy proceedings. If court-ordered support stops, it can lead to garnished wages and other consequences, including suspension of the driver’s license or even incarceration. Note that if a Kentucky bankruptcy filer lacks resources to […]

Statistics show that many Americans today are in potentially serious financial trouble. A recent Pew Charitable Trust survey found that 55% of households report spending as much or more than they make each year. And, according to a November, 2018, report  from the New York Fed Center for Microeconomic Data, household debt rose 1.6% in the third quarter of 2018 — to a staggering $13.51 trillion. Fighting mounting debt with inadequate income is a losing battle, and those who try will usually reach a point of no return. Penalties from missed payments and high interest […]

The “Sleep Outfitters” retail chain has petitioned Kentucky courts for Chapter 11 bankruptcy protection. On January 11, 2019, Sleep Outfitters, a subsidiary of Innovative Mattress Solutions, LLC,   filed for bankruptcy in  the U.S. Bankruptcy Court for the Eastern District of Kentucky, Lexington Division. Similar, large retail bankruptcy filings have become increasingly commonplace in recent years. There were 16 significant retail filings in 2018 and, as of early February, six more in 2019. Sleep Outfitters’ Bankruptcy Case In this case, Sleep Outfitters sought to borrow funding in order to continue business operations as the company looks […]

Once you have achieved a Chapter 7 bankruptcy discharge, it is time to look forward, where you’ll see  opportunity ahead. You will be free of the burden of unmanageable debt — but will also face the challenge of a lower credit score. If buying a house after Chapter 7 bankruptcy is your dream, this is a potentially achievable goal.  Many people are surprised to learn they may qualify for a post-bankruptcy mortgage much sooner than expected. Credit Issues After Chapter 7 A Chapter 7 bankruptcy will stay on your credit report for 10 years, with […]

If you are considering filing for Chapter 7 bankruptcy, you should know more about property exemptions that may apply to your case. Exemptions protect certain types of property from bankruptcy liquidation (sale), which is standard practice in Chapter 7. Non-exempt (unprotected) property can be sold to repay some of your creditors prior to Chapter 7 debt discharge, when the remaining outstanding debt is wiped away. Federal vs. State Exemptions Each state has very different bankruptcy laws, and Kentucky is one of 20 states that allow bankruptcy filers to choose between state and federal exemptions. This […]

If you are thinking about filing for Chapter 7 bankruptcy relief, you probably know this involves “liquidation,” or selling of property, to pay back debts. This is naturally worrying, especially when it comes to the property you need, such as a vehicle you use for transportation. Many pre-bankruptcy clients wonder, “Can I keep my car if I file Chapter 7?” The answer is: there is a good chance you can keep your vehicle post-bankruptcy. If there is a loan against your car, the lender has the right to repossess it for lack of payment. The […]

Filing for bankruptcy can eliminate many types of outstanding debt, including credit card balances and medical bills; but what about loans for big-ticket items like a car, house, or furniture?  A vehicle loan, a home mortgage, and a payment plan for merchandise may also be some of the loans with a bankruptcy that are dischargeable, depending upon your goals and individual circumstances. Unsecured v. Secured Loans There are two types of common loans dealt with in bankruptcy court: secured and unsecured credit. A secured loan is backed by a debtor’s obligation to return property that […]

Bankruptcy “dismissal” sounds a lot like bankruptcy “discharge,” but these two terms have very different meanings. It is important to understand this and to ensure you end up on the right side of the court ruling. A dismissal may mean you lose bankruptcy protection and remain accountable for debts you had expected to be discharged. Bankruptcy Dismissal vs. Discharge After a successful bankruptcy filing, discharge means the terms have been satisfied and all debts are considered settled — this is the outcome you are working toward when you file for bankruptcy. At the point of […]

Federal law requires employers to withhold income, Social Security, and Medicare taxes from employee wages. When a company experiences financial distress, payments for these payroll or “trust fund” taxes may be temporarily postponed or deliberately ignored. It is important for any business owner to understand that willful failure to pay employee taxes can bring a costly lawsuit from the IRS. A recent Sixth Circuit Court of Appeals decision along these lines is noteworthy.  Issued in July, 2018, the judge’s decision stresses the importance of ensuring that your company’s taxes remain current and confirms that a […]

With the average American holding more than $6,300 in credit card debt, it’s no surprise that many American consumers go overboard when it comes to accumulating balances on their credit cards. If you have a substantial amount of credit card debt and are considering the option of filing bankruptcy, you may be wondering what will happen to your current credit cards (and your ability to open new card accounts in the future) as a result. What to Expect From Your Current Cards Unfortunately, when you file for bankruptcy and a repayment plan is worked out with […]