Mississippi Bankruptcy
Mississippi Bankruptcy Law
Bankruptcy Code and Exemptions...
Although Federal Bankruptcy Code and U.S. Bankruptcy Laws apply to everyone, each state has its own Bankruptcy Code and Rules of Bankruptcy Property Exemption that apply specifically in that state.
Mississippi Bankruptcy Law
Current Filing Options...
For the first time in the past 100 year history of the state of Mississippi, wide spread financial losses and devastation threaten the economic survival of the average citizen. New Mississippi bankruptcy laws coming effective in late 2005, severely restrict the right and options of Mississippi state residents to discharge unaffordable debts. Because of these new bankruptcy laws (contained in the new federal Bankruptcy Code), no one earning above the Mississippi median income level will be allowed to file Chapter 7 bankruptcy.
New bankruptcy law dictates that for those not qualifying for discharge under Chapter 7, a five year Chapter 13 re-payment plan is mandatory while contributing all disposable income toward repayment of debts.
The standard of living allowed is determined by a new national standard for living allowances promulgated originally by the IRS for the collection of back taxes from taxpayers found guilty of evasion. New Bankruptcy Code adopted this standard, as amended from time to time, and enforces this standard of living upon all people filing Chapter 13.
This standard has been criticized by the US House and the US Senate. It's said to impose poverty upon helpless people struggling to pay debts that simply can not be repaid.
The justification of these new bankruptcy laws is that all people should pay at least according to their means, to the extent possible from their personal income. Few people truly disagree with this in purpose, but reality dictates that this is simply not acceptable and has become highly controversial. The debates in Congress over this matter has drawn fire across party lines, and ultimately, Republican majorities prevailed in establishing a new, lower threshold for poverty.
With careful bankruptcy planning, a few opportunities exist to circumvent these new requirements. While they last, all Mississippi residents should carefully consider their options, first consulting a qualified bankruptcy attorney.
New Mississippi Bankruptcy Exemptions
The language of bankruptcy related statutes in Mississippi is archaic and difficult for even lawyers and law firms to interpret in many situations. Conflicts of law, and misinterpretation are especially apparent in classifying financial products, the worth of contract options, and hybrid financial instruments. Many investment vehicles today simply do not fall neatly into any one category, yet may still be covered by a Mississippi bankruptcy exemption. In particular, conforming retirement pensions and benefits may provide an umbrella of protection for financial investments, so long as documentation of proper designation is available.
Preferential Transfers...
Transferring assets in anticipation of filing bankruptcy creates risk. Only certain transactions are allowed during the one year period before filing. Proper pre-bankruptcy planning and preparation is a must. Preferential transfers to insiders, that is family, friends, and relatives included, is of course prohibited if intended to defraud creditors. However, many legitimate transactions are allowed, which convert cash into exempt assets in the normal course of daily living. For assistance with transfer information, consult a Mississippi bankruptcy lawyer before embarking on any course of action.
Pre-Bankruptcy Planning and Preparation
Pre-bankruptcy planning is a delicate topic with many transactions prohibited, but with the assistance of a progressive bankruptcy attorney, other allowable exemptions may be identified.
In practice, most people who file for bankruptcy will actually improve their credit rating within 18 months or less. In fact, in a chapter 13 filing, credit will begin to improve once late payment reports stop, and secured loans and credit lines begin reflecting timely payments.
Overall, filing for bankruptcy can, for many Americans in many different circumstances, be an important and integral step toward financial recovery and new found fiscal stability. Ultimately, bankruptcy creates opportunities and improves net worth, so long as the decision to file was made wisely.
To learn more about Mississippi State Bankruptcy Exemptions, simply go to our U.S. Bankruptcy Exemptions page.
In most states you can legally protect your personal residence in a bankruptcy. The interesting thing is homeowners are treated differently from state to state.
Learn more about the Homestead Act and how it affects you.
Mississippi Bankruptcy Code
All Mississippi Bankruptcy cases are governed by Title 11 of the United States Bankruptcy Code, by U.S. Bankruptcy Rules, and by local Mississippi State Bankruptcy Rules promulgated by Mississippi court.
The US bankruptcy court websites generally have links to both, the Federal US Bankruptcy Rules and specific Mississippi Bankruptcy Code. Clerks in the bankruptcy courts will not give debtors, or even attorneys for debtors, legal advice, including advice about which bankruptcy rules apply to a given case.
Locate a US Bankruptcy Court in your federal judicial district.
Since US Bankruptcy Code and Mississippi Bankruptcy Rules are very technical, and since the case load in the US Bankruptcy Courts makes judges very unforgiving of mistakes or missed deadlines, it's highly recommended to seek the advice of an experienced Mississippi Bankruptcy Attorney and Certified Credit Counsellor.
The most recent Changes to the Bankruptcy Code and Bankruptcy Rules came about on April 20, 2005 as President Bush signed the Bankruptcy Abuse Prevention and Consumer Protection Act. This new Bankruptcy Law came into effect October 17, 2005.
Learn more about the 25 Most Recent Changes to Personal Bankruptcy Law and how they affect you.
