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I am often asked when is the right time for a person or business to file for bankruptcy protection. The short answer is that you should file as soon as possible, and unless there is a good reason for not doing so.

For example, you might want to wait for a period of time if you have recently paid a large amount of money to a creditor or made a major purchase not in the ordinary course.  If you do not wait, the bankruptcy trustee can undo that payment or transaction and take the money back.  However, if you can qualify to file bankruptcy now, and there is not a good reason for waiting, then I would generally recommend filing for bankruptcy sooner rather than later.

Individual persons can file for either chapter 7 or Chapter 13 bankruptcy. Individuals who make their living from farming or fishing have a few different options as well. Small businesses are limited to filing for Chapter 7, although businesses can also file for chapter 11 – but chapter 11 is far beyond the scope of this blog post.  Personally, I like chapter 7 better because it wipes all of your debts out at once and is a lot faster than chapter 13. However, your net income (your gross income after payroll deductions and expenses) has to be below a certain level for your family size in order for you to qualify for Chapter 7 bankruptcy.

I prefer to file for Chapter 7 bankruptcy on behalf of the debtor, unless there is a good reason for choosing chapter 13 bankruptcy. A good reason for choosing chapter 13 would be if the debtor makes too much money to qualify for Chapter 7, or if the debtor has a lot of equity in a house.  Your bankruptcy attorney will be able to explain to you the differences between chapter 7 and Chapter 13, and which one is a better option for you.

Baland Law Office, P.L.L.C. represents consumer and small business debtors in both Chapter 7 and Chapter 13 bankruptcy proceedings. Please note that only individual debtors can file for Chapter 13 bankruptcy relief, not businesses.  Please call (763) 450-9494 to schedule an appointment to discuss your situation today and find out whether declaring bankruptcy is the right option for you!

DISCLAIMER: Baland Law Office, P.L.L.C. is a debt-relief agency, and Timothy H. Baland, Esq. is a debt-relief agent.  We help people like you to obtain bankruptcy relief.

WARNING: The information contained in this article does not constitute legal advice and may not be applicable to your situation.  Reading this blog post does not create an attorney-client relationship between you and Baland Law Office, P.L.L.C.  You should always discuss your situation with an attorney before taking any action based on what you may read in this blog.  To that end, please call (763) 450-9494 to set up an appointment to discuss your situation.



 
 
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I am frequently asked whether a person should have a Will. The short answer is that yes, most people need a Will, especially if the testator (the person making the will) has significant assets and property, and wants to control how his or her property is disputed after death.

If you die intestate, and do not have a Will, the property that you own at the time of your death will pass on to your heirs according to the laws of the state of Minnesota. You may not be happy with the results.

There are many reasons for you to have a Will, but the main reason – at least for me – is control. You get to control who is going to be your personal representative, trustee (if a trust is necessary), guardian for your children, etc. After all, what happens to your property after you die should be your choice – not the choice of the legislature (in its infinite wisdom). Rather, your property should be distributed according to your wishes, and what you want to happen should happen.

With a Will, you can clearly tell your family what you want to happen to your personal property, and minimize confusion in doubt about what should happen. Saying what you want to happen in advance of your death will make it a lot easier for those who come after you, and go a long way towards keeping peace in your family. If you tell your children who should get grandma's chifferobe, your children will not spend time, energy, and money fighting about it.

A Will may also be appropriate if you have unique assets, such as antiques, collections, heirlooms, or a family business, or a unique personal situation, such as a minor child or incapacitated or beneficiaries who have not yet reached the age of majority. With a Will, you can include persons who would not otherwise be heirs, such as stepchildren, friends, and charities, and exclude persons who are hairs under the law and entitled to receive a portion of your estate.

Your needs and whether a Will is right for you depends on your specific situation. You should seek the advice of an attorney before taking action based on this blog post.  To that end, I invite you to give me a call at 763-450-9494 to discuss  your unique situation.

WARNING: The information contained in this blog post does not constitute legal advice and may not be applicable to your situation.  Tim is licensed to practice law only in Minnesota, and the information contained in this blog post may not apply to jurisdictions outside of Minnesota.  Further, reading this blog post does not create an attorney-client relationship between you and Baland Law Office, P.L.L.C.  You should always discuss your situation with an attorney before taking any action based on what you may read in this blog.  To that end, please call (763) 450-9494 to set up an appointment to discuss your situation.











 
 
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I am often asked whether a landlord should form a limited liability company (or LLC for short) or otherwise incorporate. The short answer is usually yes.

The default for a landlord is a sole proprietorship, where the landlord uses his or her bank accounts for the business and reports business income and loss on schedule C of his or her federal tax return. A judgment creditor can reach the landlord's personal assets, including the landlord's house, to satisfy a judgment. However, it is important to note that there are several exceptions, but that a detailed discussion of the law regarding the creditor – debtor relationship is beyond the scope of this blog post.

By contrast, a landlord who forms a limited liability company is shielded from personal liability for the acts of the corporation, unless the corporation is the landlord's "alter ego." Business income and loss is still reported on schedule C of the landlord's federal tax return, just as if the landlord were operating a sole proprietorship. If there is more than one person involved, those persons can be made members of the limited liability company.

To prove the existence of an "alter ego," a person who sues the landlord would have to prove that the corporation was merely the "alter ego"– and indistinguishable from – the individual landlord.  However, a plaintiff may be able to prove the existence of an "alter ego" if the landlord and the corporation share bank accounts, do not maintain corporate records, and otherwise do not take any steps to separate the finances of the corporation from the finances of the landlord. For this reason, I recommend that any landlord who forms a limited liability company take steps to separate the corporation from their personal life.

The chief benefit of forming a limited liability company is the protection from personal liability.  In other words, a judgment creditor cannot reach the assets of the individual owner, unless the judgment creditor proves the existence of an "alter ego."

However, owning a limited liability company comes with certain responsibilities. The landlord has to file an annual renewal every year with the secretary of state. Moreover, any major decisions, such as the purchase of a new building, furnace, or other equipment, need to be recorded in writing.  In addition, the landlord has to pay a fee to incorporate as a limited liability company.

A landlord who has incorporated as a limited liability company cannot represent himself or herself in District Court, even in an eviction. Rather, the landlord must be represented by an attorney. It is important to note that an officer of the landlord may represent a landlord in conciliation court, but a corporate landlord must be represented by an attorney in District Court.

Given the advantages associated with forming a limited liability company, it is difficult to imagine a scenario where a landlord would not form a limited liability company. However, there are other corporate entities available to a landlord who wishes to incorporate, such as an S Corp. Still, I tend to think that a limited liability company is most appropriate for most people, unless there is a good reason for not forming a limited liability company.

Your needs and whether a limited liability company is right for you depends on your specific situation. You should seek the advice of an attorney before taking action based on this blog post.  To that end, I invite landlords to give me a call at 763-450-9494 to discuss their unique situation. I do not typically represent individual tenants, although I will represent corporate tenants on a case-by-case basis.

WARNING: The information contained in this blog post does not constitute legal advice and may not be applicable to your situation.  Tim is licensed to practice law only in Minnesota, and the information contained in this blog post may not apply to jurisdictions outside of Minnesota.  Further, reading this blog post does not create an attorney-client relationship between you and Baland Law Office, P.L.L.C.  You should always discuss your situation with an attorney before taking any action based on what you may read in this blog.  To that end, please call (763) 450-9494 to set up an appointment to discuss your situation.