Hi,
I'm looking for some any advice, words of encouragement, etc on my situation. I have been poking around here for about a month and have found some very useful information. I am also a bit overwhelmed with all of the info that is available and was hoping to clear up some of my questions. Here are some details of my situation.
I live in a rural part of Pennsylvania and I work from home as a computer programmer / web developer. I have done business as an LLC since 2002. The LLC I have is setup as a pass through entity and my taxes were filed as such. I have a little more than $30k in credit card debt spread across 15 different accounts. I have one account that is in the LLC name only. The rest are either in my name only or in my name and the LLC name. Most of the debt was for business expenses, however some of it from the past two years was just to survive. I am not married, but have lived with my girlfriend for 10 years. She also does the same kind of work and is paid in part by the LLC. We have bank accounts and credit cards in our own names. We have 1 credit card that was opened in my name but I added her on to the account. We have 1 son together and she has a daughter from a previous marriage. They both live with us.
I own a 2001 mini van that I just paid off in November. The mortgage on the house is in my name only. We bought the house about 6 years ago. We probably owe more than what the house is worth, but plan on trying to maintain the mortgage payments which are up to date.
Business was good up until about 2 years ago. We started noticing a decline in what we were earning month to month. it was small at first, so we tried to adjust what we were doing to get our earnings back up. Nothing seemed to work. We ended up losing about 70% of our monthly income from the high point. I have pretty much run through any savings and money we have had to keep the credit card payments up to date. Unfortunately, it got the better of me and we have nothing left. I have completely stopped paying my credit cards in attempt to keep the mortgage and other bills up to date. I have no savings and no possessions of any real value. My furniture is 6+ years old and was cheap when I bought it. All but the dishwasher came with the house when we bought it and were well used at that point. My washer and dryer are about 2 years old. My TV is probably more than 10 years old and I don't own much more than that as far as household furnishings and appliances. We have about 200 DVD's or so which are mostly for the kids and then a bunch of stuff that doesn't hold much value outside of sentimental.
I have a few collectibles that were given to me as gifts during better times which might total $1000 on a good day. The business has no real assets that I can think of and currently there are only 4 customers which are billed on a recurring basis for about $100 per month total with additional income being from programing work, which is generally sporadic. We also run some websites that provide about 60% of our current income. Outside of my personal belongings, I have 2 computers. 1 that I use for my work and 1 the kids use. My GF has her own system. These were purchased on credit about 18 months ago. They are on the credit account that is in the business name only. I have a few other purchases on that account too from around June of this year for computer equipment. I also have about 200 domain names that are either currently in use for websites that contribute to our income or were registered with the intent of putting them to work for us. My girlfriend also has about 100 domain names.
I have been to talk with two attorneys so far. The first was recommended by an attorney who I trust. He told me I should file Chapter 7 for myself and just take a wait and see approach as to whether the LLC would get sued for any of the debt in it's name. I was happy with what he had to say and plan on using him.
However, after reading through many of the posts on here I figured it would be best to seek out other opinions. I live in a very rural area in Pennsylvania and there are not many BK attorneys very close, making my options limited. I found an ad in the paper and called another attorney. I saw him about a week ago. Even though he said I am qualified for chapter 7, he suggested (more like persuaded or nearly demanded) I should consider chapter 13. It seemed to me as a way for him to make more money off me. I left that meeting with a real bad taste in my mouth and subsequently lost the guys number.
I am planning on following the advice of the first attorney and going with him as soon as I have enough money to pay his retainer. In the mean time, I am looking into a few more attorneys that are within a 30 minute radius. Now, on to my questions. I have asked these to both attorneys so far. I would just like to see if anyone else has been in a similar situation or if anyone might have some alternative advice from what I have already received
1) Can the domain names I have be considered assets as there is an annual expense to keep them active? I have searched the forum on this subject and have found a limited number of threads. One had some valuable information, but left me with more questions. The only value I see in them is the ability for them to add to our income when they are developed websites. I have never had them appraised because honestly, I feel as though all but maybe a handful are worth less than what it would cost to appraise them.
2) If they are assets are they covered by any sort of exemptions?
3) If they are assets, would they be my assets or assets of the LLC?
4) My son has two savings accounts worth about $600 total and savings bonds worth a little more than that. They all have my name on them as well as his name. Are these safe? Do I have to declare these?
5) What are the chances that the creditor who I used to purchase the computers 18 months ago is going to come looking for them?
6) The dining room set as well as some of the other furniture in the house, including the kids' bedroom furniture is owned by my GF. Is this something I have to list on the inventory of assets?
7) Does my GF's jewelry have to be listed or is that considered hers?
8) Will I be able to maintain the LLC after filing chapter 7? The name is very sentimental to me and I would hate to give it up.
9) The forms I have been looking at the the first attorney gave me as well as some of the credit counseling sites I have been looking at want monthly income and expenses. While, expenses won't be a problem. Income may because it varies from month to month. What's the best way for someone with a variable income to determine monthly income? Should I use my previous years taxes and divide by 12? Use past 6 months income? Or something else?
10) What effect will my filing chapter 7 have on the CC account that has my GF's name on it? Can it impact her credit in any way? The bill itself comes to me and makes no mention of her. She had a second card on the account.
11) What role does the income of my GF play in any of this? Most of our income is derived through the LLC with her getting paid from there and then my income coming after business expenses are calculated and what not. But, she does have some additional income and a monthly support payment from her Ex. Is any of that calculated on the income and expense statements?
12) Is my minivan exempt?
I think I will leave it at that for now. Sorry for the extra long post. I have been tossing these questions around in my head for awhile now and am just looking to get myself moving forward and getting this taken care of rather than worrying about this stuff. Thanks for any and all information!
I'm looking for some any advice, words of encouragement, etc on my situation. I have been poking around here for about a month and have found some very useful information. I am also a bit overwhelmed with all of the info that is available and was hoping to clear up some of my questions. Here are some details of my situation.
I live in a rural part of Pennsylvania and I work from home as a computer programmer / web developer. I have done business as an LLC since 2002. The LLC I have is setup as a pass through entity and my taxes were filed as such. I have a little more than $30k in credit card debt spread across 15 different accounts. I have one account that is in the LLC name only. The rest are either in my name only or in my name and the LLC name. Most of the debt was for business expenses, however some of it from the past two years was just to survive. I am not married, but have lived with my girlfriend for 10 years. She also does the same kind of work and is paid in part by the LLC. We have bank accounts and credit cards in our own names. We have 1 credit card that was opened in my name but I added her on to the account. We have 1 son together and she has a daughter from a previous marriage. They both live with us.
I own a 2001 mini van that I just paid off in November. The mortgage on the house is in my name only. We bought the house about 6 years ago. We probably owe more than what the house is worth, but plan on trying to maintain the mortgage payments which are up to date.
Business was good up until about 2 years ago. We started noticing a decline in what we were earning month to month. it was small at first, so we tried to adjust what we were doing to get our earnings back up. Nothing seemed to work. We ended up losing about 70% of our monthly income from the high point. I have pretty much run through any savings and money we have had to keep the credit card payments up to date. Unfortunately, it got the better of me and we have nothing left. I have completely stopped paying my credit cards in attempt to keep the mortgage and other bills up to date. I have no savings and no possessions of any real value. My furniture is 6+ years old and was cheap when I bought it. All but the dishwasher came with the house when we bought it and were well used at that point. My washer and dryer are about 2 years old. My TV is probably more than 10 years old and I don't own much more than that as far as household furnishings and appliances. We have about 200 DVD's or so which are mostly for the kids and then a bunch of stuff that doesn't hold much value outside of sentimental.
I have a few collectibles that were given to me as gifts during better times which might total $1000 on a good day. The business has no real assets that I can think of and currently there are only 4 customers which are billed on a recurring basis for about $100 per month total with additional income being from programing work, which is generally sporadic. We also run some websites that provide about 60% of our current income. Outside of my personal belongings, I have 2 computers. 1 that I use for my work and 1 the kids use. My GF has her own system. These were purchased on credit about 18 months ago. They are on the credit account that is in the business name only. I have a few other purchases on that account too from around June of this year for computer equipment. I also have about 200 domain names that are either currently in use for websites that contribute to our income or were registered with the intent of putting them to work for us. My girlfriend also has about 100 domain names.
I have been to talk with two attorneys so far. The first was recommended by an attorney who I trust. He told me I should file Chapter 7 for myself and just take a wait and see approach as to whether the LLC would get sued for any of the debt in it's name. I was happy with what he had to say and plan on using him.
However, after reading through many of the posts on here I figured it would be best to seek out other opinions. I live in a very rural area in Pennsylvania and there are not many BK attorneys very close, making my options limited. I found an ad in the paper and called another attorney. I saw him about a week ago. Even though he said I am qualified for chapter 7, he suggested (more like persuaded or nearly demanded) I should consider chapter 13. It seemed to me as a way for him to make more money off me. I left that meeting with a real bad taste in my mouth and subsequently lost the guys number.
I am planning on following the advice of the first attorney and going with him as soon as I have enough money to pay his retainer. In the mean time, I am looking into a few more attorneys that are within a 30 minute radius. Now, on to my questions. I have asked these to both attorneys so far. I would just like to see if anyone else has been in a similar situation or if anyone might have some alternative advice from what I have already received
1) Can the domain names I have be considered assets as there is an annual expense to keep them active? I have searched the forum on this subject and have found a limited number of threads. One had some valuable information, but left me with more questions. The only value I see in them is the ability for them to add to our income when they are developed websites. I have never had them appraised because honestly, I feel as though all but maybe a handful are worth less than what it would cost to appraise them.
2) If they are assets are they covered by any sort of exemptions?
3) If they are assets, would they be my assets or assets of the LLC?
4) My son has two savings accounts worth about $600 total and savings bonds worth a little more than that. They all have my name on them as well as his name. Are these safe? Do I have to declare these?
5) What are the chances that the creditor who I used to purchase the computers 18 months ago is going to come looking for them?
6) The dining room set as well as some of the other furniture in the house, including the kids' bedroom furniture is owned by my GF. Is this something I have to list on the inventory of assets?
7) Does my GF's jewelry have to be listed or is that considered hers?
8) Will I be able to maintain the LLC after filing chapter 7? The name is very sentimental to me and I would hate to give it up.
9) The forms I have been looking at the the first attorney gave me as well as some of the credit counseling sites I have been looking at want monthly income and expenses. While, expenses won't be a problem. Income may because it varies from month to month. What's the best way for someone with a variable income to determine monthly income? Should I use my previous years taxes and divide by 12? Use past 6 months income? Or something else?
10) What effect will my filing chapter 7 have on the CC account that has my GF's name on it? Can it impact her credit in any way? The bill itself comes to me and makes no mention of her. She had a second card on the account.
11) What role does the income of my GF play in any of this? Most of our income is derived through the LLC with her getting paid from there and then my income coming after business expenses are calculated and what not. But, she does have some additional income and a monthly support payment from her Ex. Is any of that calculated on the income and expense statements?
12) Is my minivan exempt?
I think I will leave it at that for now. Sorry for the extra long post. I have been tossing these questions around in my head for awhile now and am just looking to get myself moving forward and getting this taken care of rather than worrying about this stuff. Thanks for any and all information!
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