Bk7 and bk13 = chapter20?

[scubaman]

I have just been informed by my attorney that if I filed a bk7 in november of 2008 and closed 3/09 that I am not able to do a bk13 for another 8 years? This does not make sence to me because now I am in negotiations with the IRS for a payment plan/OIC and if the IRS did not work with me then my attorney told me to come back to them and we would do a bk13?

Am I missing something here? I thought you could do a bk7 and bk13 back to back if you have priority taxes such as the taxes and could to a bk13.

also my taxes are over 3 years old so and no assets would this be considered priority taxes?

I do appreciate anyone that could possibly bring me up to date on these issues.
Thanks

[woeisme]

It is my understanding that when they re-did the BK laws a few years back, they changed the rules to basically prevent CH 20's, although they really aren't against the rules, just the rules are different. The big change is that you can no longer have your CH 13 "discharged" until X-number of years (maybe that's the 8 your lawyer sited, I don't know the rules exactly). So you can get CH 13 protection, only have disposable income going to IRS, not their crazy tax levies where they can take everything and the kitchen sink, but at the end of the CH 13, you don't get an official discharge, so if you didn't pay off some of your tax debt, you'd still owe it.

[optimistic1]

Fire your attorney because he is so wrong.

The official rule is this,

You can't get a Chapter 13 discharge if you received a discharge in a previous Chapter 13 case in the last two years, or a discharge in a Chapter 7 case filed within the last four years.

You aren't barred from filing a Chapter 13 bankruptcy in these circumstances, but you cannot get a discharge until the requisite time has passed.

For instance, you can file a Chapter 13 bankruptcy the moment you receive a Chapter 7 case discharge (to handle liens that survived your Chapter 7 case or debts weren't discharged in that case), but you wont get your Chapter 13 discharge until four years have passed since you filed the earlier Chapter 7 case.



This is all verbatim from the NOLO Chapter 13 bankruptcy book, latest edition, written by and reviewed by attorneys and the National Association of Consumer Bankruptcy Attorneys.

Go pick it up from barnes and noble and let him read page 26.

or better yet, print out this section of the Bankruptcy Code, which is constitutional law, which courts must rule by.


Discharge

(a) Subject to subsection (d), as soon as practicable after completion by the debtor of all payments under the plan, and in the case of a debtor who is required by a judicial or administrative order, or by statute, to pay a domestic support obligation, after such debtor certifies that all amounts payable under such order or such statute that are due on or before the date of the certification (including amounts due before the petition was filed, but only to the extent provided for by the plan) have been paid, unless the court approves a written waiver of discharge executed by the debtor after the order for relief under this chapter, the court shall grant the debtor a discharge of all debts provided for by the plan or disallowed under section 502 of this title, except any debt--

(1) provided for under section 1322(b)(5);

(2) of the kind specified in section 507(a)(8)(C) or in paragraph (1)(B), (1)(C), (2), (3), (4), (5), (8), or (9) of section 523(a);

(3) for restitution, or a criminal fine, included in a sentence on the debtor's conviction of a crime; or

(4) for restitution, or damages, awarded in a civil action against the debtor as a result of willful or malicious injury by the debtor that caused personal injury to an individual or the death of an individual.

(b) Subject to subsection (d), at any time after the confirmation of the plan and after notice and a hearing, the court may grant a discharge to a debtor that has not completed payments under the plan only if--

(1) the debtor’s failure to complete such payments is due to circumstances for which the debtor should not justly be held accountable;

(2) the value, as of the effective date of the plan, of property actually distributed under the plan on account of each allowed unsecured claim is not less than the amount that would have been paid on such claim if the estate of the debtor had been liquidated under chapter 7 of this title on such date; and

(3) modification of the plan under section 1329 of this title is not practicable.

(c) A discharge granted under subsection (b) of this section discharges the debtor from all unsecured debts provided for by the plan or disallowed under section 502 of this title, except any debt--

(1) provided for under section 1322(b)(5) of this title; or

(2) of a kind specified in section 523(a) of this title.

(d) Notwithstanding any other provision of this section, a discharge granted under this section does not discharge the debtor from any debt based on an allowed claim filed under section 1305(a)(2) of this title if prior approval by the trustee of the debtor’s incurring such debt was practicable and was not obtained.

(e) On request of a party in interest before one year after a discharge under this section is granted, and after notice and a hearing, the court may revoke such discharge only if--

(1) such discharge was obtained by the debtor through fraud; and

(2) the requesting party did not know of such fraud until after such discharge was granted.

(f) Notwithstanding subsections (a) and (b), the court shall not grant a discharge of all debts provided for in the plan or disallowed under section 502, if the debtor has received a discharge--

(1) in a case filed under chapter 7, 11, or 12 of this title during the 4-year period preceding the date of the order for relief under this chapter, or

(2) in a case filed under chapter 13 of this title during the 2-year period preceding the date of such order.

[scubaman]

Thanks for everyone's advise - I have that book thats why I thought I was on the right track. I am still in negotiations with the IRS for a payment plan and then an OIC so once I have completed this process and they won't except my OIC etc. , I will then go forward and see about the 13.
Again thank you for all your feedback!

[optimistic1]

No problem, that book is the bible, they need to give it for free to all these so called bankruptcy/personal injury lawyers, that way they stop misinforming their clientel.

[HHM]

Yes, your attorney is dead wrong. You CAN do a chapter 13 immediately after a chapter 7 if the goal is to pay priority debt. However, a chapter 13 to pay priority debt is actually a little more expensive then simply doing a 60 payment plan with the IRS. Reason being, interest continues to accrue on priority tax debt even in a chapter 13 and the chapter 13 has the trustee fee. So, your payment in a chapter 13 would be a little higher than an Installment agreement with the IRS. The only reason you do the chapter 13 is if the IRS won't play ball.

[qsr]

Has anyone been able to do a Ch 20 to save their house (since 2005)? I'm hoping I could stall my mortgage servicer long enough to get through the Chapter 7 and get into a Chapter 13 after I get a job. I know the challenge here will be staving off the lift of automatic stay.

[HHM]

Has anyone been able to do a Ch 20 to save their house (since 2005)? I'm hoping I could stall my mortgage servicer long enough to get through the Chapter 7 and get into a Chapter 13 after I get a job. I know the challenge here will be staving off the lift of automatic stay.

It's possible, it depends on how mortgages work and the timing of your BK-7. You are correct. Your issue will be staving off the lift of the automatic stay. You will need an attorney willing to file an opposition to the MTLS (Motion to Lift Stay). In most areas, a foreclosure simply picks up where it left off once the stay is lifted.

The bigger problem is the lack of a job. If by some chance you are able to stave off the foreclosure long enough to discharge your chapter 7, realize that once you file your subsequent chapter 13, you need to be in a position to at least start making the regular mortgage payment at the next due date after filing.

But to answer your question, technically, yes; you can file a chapter 13 after a 7 to cure your mortgage arrears. But, for most people in your circumstances, from a practical perspective, it is very difficult to do.