Wednesday, April 20, 2011

Documents needed for Illinois Bankruptcy filing

In Illinois, a debtor who is filing for bankruptcy, whether it is chapter 7 or chapter 13 must provide documents to the trustee right after filing.   These documents include pay advices and income statements, as well as tax returns.

Most people have their tax returns handy, and can forward a copy.   If not, the IRS can send you copies of the tax return transcripts (actually preferred by many of the trustees!).  You can call the IRS at 1-800-908-9946 to obtain copies (usually the last 4 years are needed).   You can also order them by mail using the following IRS Form 4506-T.   Best news, is that they are free!!

You also need to send the last 2 months of pay stubs or income statements to the trustee, and you need to use the information from the last 6 months before filing to help calculate your Means Test Calculation on Form 22.
Hopefully, you have the documents handy, or your employer can reprint them for you.   If you are unemployed, you can access your unemployment statements in Illinois here.

This will help expedite your case, as your case can be dismissed for failure to submit these documents to the trustee.   For further information, you can contact the attorneys of Leeders & Associates for a free bankruptcy consultation to review all of your options, and filing requirements.


Bankruptcy fraud and baseball -Lenny Dykstra

Here is a recent story I read about bankruptcy fraud. Unfortunately, this happened to former big league star, Lenny Dykstra.  He is being accused of selling off his personal assets that were under control of his bankruptcy estate, monitored by the trustee.   This includes selling off of some sports memorabilia, and even the kitchen sink!! It's a good read, but an unfortunate story.  This leads me to the moral of the story, if you are starting a business, use a lawyer.  Obtain some type of corporate protection, whether it's an LLC, an S-Corp. or something similar.  This insulates your personal assets from the business, should things not work out as hoped.    Also, try to avoid personal guarantees, they will survive a closed business, and the only way to get rid of them is to pay them off, or file a personal bankruptcy, such as Mr. Dykstra filed.   Always seek the advice of your bankruptcy lawyer as well.