Philadelphia Bankruptcy Attorney – Bankruptcy and the Elderly: Is Bankruptcy the Right Choice?
According to an article on the internet site, www.stuff.co.nz, a 74-year old grandmother recently filed for bankruptcy after being stuck with $13,000 in debt. A “friend” had convinced her to take out a loan in her own name because she was unable to get one herself, then failed to pay the loan off. Unfortunately, the elderly are frequent victims of scammers and fraudsters. Scammers frequently convince retired persons to sign over property, withdraw loans, and engage in other questionable behavior, often to “save a family member” or extricate themselves from perceived debt collectors. Sadly, even when the fraudsters are caught (and they rarely are), sometimes seniors are unable to have the debt cleared.
In addition to scams, seniors can end up in financial trouble due to medical expenses they are unable to afford. At a time in life when income is limited, as are their options for employment or other means of obtaining money, seniors can become overwhelmed by this kind of debt.
Is Bankruptcy a Good Solution for Debt-ridden Seniors?
Seniors may feel trapped by debt, but feel intimidated by the idea of filing for bankruptcy. Other options do exist, such as credit counseling, but more and more seniors are deciding that bankruptcy is the best choice for their situations. A Philadelphia bankruptcy attorney can give the best guidance about bankruptcy options, but the good news is that most senior assets are exempt and therefore protected in bankruptcy.
Pennsylvania has its own set of exemptions that differ from federal exemptions, and filers are able to choose to abide by either Pennsylvania or federal exemptions. Some general exemptions include:
Retirement Accounts and Pensions
Under federal bankruptcy rules, most retirement accounts and social security benefits are exempted incomes in bankruptcy. Specifically, 401(k)s, 403(b)s, profit-sharing, defined-benefit (pension) plans, and money purchase plans are all exempted. Furthermore, IRAs and Roth IRAs are exempted up to a little more than a million dollars.
Primary residences are usually exempted in bankruptcy, but in a Chapter 13 bankruptcy, the equity can be used to pay creditors. Under some circumstances, however, all or part of the equity is exempt. A Philadelphia bankruptcy attorney can advise filers about the best path to choose, but Pennsylvania allows married couples to double up on exemptions if a property is jointly owned.
Social security income is exempt under federal law. In addition, social security income is excluded from the Means test, so a senior may be able to qualify more easily for a Chapter 7 bankruptcy.
Call Alfred Abel Law Offices for an Experienced Philadelphia Bankruptcy Attorney
Deciding to file for bankruptcy is an emotional and overwhelming choice to make. The Philadelphia bankruptcy attorneys at Alfred Abel Law Offices understand the anxiety that underpins bankruptcy. Alfred Abel Law Offices is an experienced law firm that helps clients navigate the difficult legal issues. For a consultation, contact us today at 610-940-1635.
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