• Will Congress Adjust the AMT to Avoid Fiscal Cliff?

    Following the November election, many media pundits and experts are warning of the impending “fiscal cliff” expected to hit the country in early 2013. The term is used to describe a series of enacted legislation that will lead to tax increases, federal spending cuts and a reduction in the budget deficit at the end of 2012. Most experts have proposed avoiding the fiscal cliff by extending certain parts of the 2010 Tax Relief Act or changing the 2011 Budget Control Act, which would decrease taxes, but increase the deficit.

    Experts predict that if you have a household income over $75,000, you will see a substantial increase in your taxes. Residents in high-cost urban areas are expected to be hit hardest. Some congressional aides have speculated that the Internal Revenue Service (IRS) has advised Congress to adjust the Alternative Minimum Tax (AMT) after the filing season starts in January, which would lead to delays in return processing for nearly half of all Americans.

    “That would be a disaster, an unmitigated disaster for the taxpayers of the United States,” said Nina Olson, national taxpayer advocate at the IRS. “It’s just not possible to do that.”

    Many Americans plan their budget and finances based on getting their tax refunds in a timely fashion. This may be last thing many individuals who may already be on the verge on bankruptcy need.

    Benjamin Brand Services- Chicago bankruptcy lawyers .

  • Creditors of Student Loans Go after Co-Signers

    Katy Stech of the Wall Street Journal recently wrote an editorial about Kristina Pietras, a student who became burdened with student loan debt before dropping out of the University of Toledo. Various lenders lent Pietras $132,000 in loans. Pietras’ parents had co-signed her loans.

    Lenders took Pietras and her co-signers to court, where they argued that she was paying $150  month for a cable television package and recently had new carpet installed instead of paying back the loans. Her parents were paying her cell phone bill at $70 a month while she worked at an Arby’s restaurant.

    “The court is, thus, confronted with this dichotomy: the debtors, when incurring obligations on behalf of their daughter, find the means to pay for one obligation but not the other,” wrote Judge Richard Speer of the U.S. Bankruptcy Court in Toledo.

    As more and more students find themselves unable to repay loans, the creditors are going after the co-signers. More than 90 percent of student loans require a co-signer. More and more co-signers may find themselves in bankruptcy court if this trend continues. Contact our firm for a free consultation.

    Benjamin Brand Services- Chicago bankruptcy lawyers .