Posted on 04/17/2012 10:39:57 AM PDT by IbJensen
Bled white and destroyed by Barack Obama’s “hope and change” hundreds of thousands of Americans have been forced to use tax refunds to pay the filing costs of their bankruptcies. The National Bureau of Economic Research (NBER) reports that bankruptcy lawyers have seen an increase in personal bankruptcies filings which follow this pattern: many clients are filing bankruptcy soon after receiving their tax refunds.
This has been especially true since a law passed in 2005 made bankruptcy more costly and more difficult. For some people, in Barack Obama’s upside down America as fast as money comes in it goes to buy a bankruptcy file number. There are no plans for vacations or buying a new car for many people. As one bankruptcy lawyer explained the situation, “If people are expecting a big refund, they go as fast as they can to a tax preparer. They need the money so they can afford to file for bankruptcy.”
Filing costs that averaged around $ 921.00 before the law now cost most filers $1477 and more. Of course as usual the big winners from this law are lawyers who get to charge higher fees based on more time spent to verify the facts presented by the individual seeking relief. The changes in the law were made to combat fraud which is a worthy goal, but raising the filing fees has resulted in punishing many legitimate people who only want to have their debts cancelled so they can go on with their lives.
The NBER report’s author argues “…. if you want to curtail abuse, raising the cost is not a good way to do it. The people who really need bankruptcy are the ones who will be unable to pay for the fees.”
While it is true that there have been fewer bankruptcies since the new law went into effect, that is not necessarily a good thing. There has been little tangible benefit from the new rules for society in general and many who need bankruptcy are denied discharge of their debts. Welcome to Obama’s upside down America.
More here:
http://www.usatoday.com/money/perfi/taxes/story/2012-04-12/tax-refund-filing-for-bankruptcy/54227664/1
How many of these filers will vote for Obama?
Obama voters don’t file for bankruptcy. When your on the govt’ dole, I would guess they are judgement proof from creditors.
I think courts have a paupers application that can be filed for the court to consider waiving the fee.
I may be wrong, but it seems you are speculating that people filing for bankruptcy are primarily irresponsible and left leaning. That was probably the case at one time, but today there are a lot of people across the spectrum that are in a hopeless situation. A lot are small business owners or people who have lost jobs in Obama's Depression.
Our nation is in trouble. A lot of people who would never have considered bankruptcy in the past, now are facing it.
My fear is that our nation will need to declare bankruptcy. A year of Jubilee, if you will. How will that effect our enemies - foreign and domestic - who have deliberately destroyed our economy and drowned us in debt? I doubt they want our nation to have a way to get back up off the mat, but soon, the only way to do that will be to cancel ALL debt and start fresh.
I agree. Bankruptcy is a deleveraging tool. Generally, debts are restructured to try to pay them back. This isn’t the same as just walking away from the problem. I also agree that the economy has been so bad for so long now that there are responsible people being pulled down now. Let’s not forget, real unemployment is still north of 12%.
Assumption is the mother of all...
foolishness, to put into a more decent word.
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