Congress amended the Bankruptcy Code in October, 2005. I think they simply wanted to make it more difficult to file, but I think they just made it more complicated. Congress had this idea that there couldn’t POSSIBLY be that many poor people out there who needed to file bankruptcy. Members of Congress believed that people were lying on their bankruptcy forms and no accurately reporting their income and expenses. To rectify that situation, here is what they now require:

1. Paystubs. When you file bankruptcy, your attorney must file the last sixty days’ worth of paystubs with the Bankruptcy Court. If you do not receive a paystub, either because you are in business for yourself, or because you are retired or disabled, here is an affidavit you can file with the court.

         In addition, the Bankruptcy Court wants me to review your income for the past six months and create an average for you. If you earn above the medium income for a family of your size in your state, you may not quality for Chapter 7. So, to do this, I will need to take a look at your paystubs for the past six months, or a print-out from your employer. If you do not have these, we can still meet for your FREE CONSULTATION, but I may have to send you out to gather more information.

         Needless to say, Congress has discovered very little “fraud” since the new law took effect. My clients were telling the truth, all along: they really are going through hard financial times!

   Tax Returns. When you file bankruptcy, your attorney must send your most recent tax return to the bankruptcy trustee for review. Again, Congress is trying to figure out, if you’re really as poor as you say you are. The trustee has the right to ask for up to four years, so I ask my clients to bring in the last four year’s tax returns, if they have them. If you do NOT have tax returns, then you can obtain a “tax transcript” from the IRS.

         How do you get an IRS tax transcript? Here is what the IRS says: “You have two easy and convenient options for getting copies of your federal tax return information--tax return transcripts and tax account transcripts--by phone or by mail. Request transcripts by calling 1-800-829-1040, or order by mail using IRS Form 4506T (Request for Transcript of Tax Return). We do not charge a fee for transcripts. Allow two weeks for delivery.” http://www.irs.gov/individuals/article/0,,id=110571,00.html

   Consumer Credit Counseling. Before you can file bankruptcy, there is a pre-filing credit briefing that you must complete. There are only certain companies officially approved by the U.S. Bankruptcy Court to provide this briefing. We go through the national Greenpath office. Their website provides detailed information at www.greenpathBK.com. They will not try to “talk you out of filing bankruptcy.” In fact, they cannot help most people who call their offices, but they will spend 90 minutes on the phone with you, explaining what consumer credit counseling can and cannot do for you, in your situation. Congress is trying to help people find alternatives to bankruptcy.

         After you file bankruptcy, there is a “Financial Management Class” you must take and complete before you can obtain a discharge of your debts. Greenpath will send you a book to read and review and you will call them up and answer some questions about better financial management. Congress does not want you to have to fall into the same situation, again.

         The cost of the complete program is $95 for a single person and $110 for a married couple. Once you have paid us a retainer fee, we will give you our “Client Code.” This will allow you to call Greenpath and they will bill us for your classes.

         Here is a short brochure in *.pdf about Greenpath’s program. Greenpath Brochure

         Before you call Greenpath, they want you to fill out a short worksheet about your income and expenses. Here is the worksheet in word. Greenpath Checklist

         Here is a Frequently Asked Questions statement from Greenpath. F.A.Q.