Much of the world is in a state of uncertainty and confusion. Economies all over the world are closed, leaving millions without work. Without any reliable income, this has many worried about how they will pay their bills. Individuals who were already in the middle of a bankruptcy are likely to feel even more unsure about their financial future. With new laws and reliefs, it can be difficult to determine what you are eligible for and how this worldly situation will affect your current filing.
What Is the CARES Act?
The CARES Act was officially signed into place on March 27, 2020. CARES stands for the Coronavirus Aid, Relief, and Economic Security Act. This act includes an amount of relief that equals $2.2 trillion. This act covers things like unemployment, small business relief, and even has some changes to Chapter 7 and Chapter 13 bankruptcy filings.
CARES Act Bankruptcy Changes to Expect
The CARES Act is intended to help consumers and small businesses financially. There are also portions of the act that affect those currently in bankruptcy.
You can expect the following changes:
Federal Payments are Excluded From Classification as Income
Individuals who are currently navigating a bankruptcy case or who are already paying into a bankruptcy case are required to report all of their income. In return, this income is then counted toward the required monthly debt payments. The CARES Act does not categorize any compensation received because of the federal emergency as income. Stimulus payments or unemployment increases are not considered to be disposable income and therefore, they should not affect your required payments.
Individuals Can Make COVID-19-Related Modifications
The government realizes that the majority of people’s income has changed in one way or another with COVID-19. Even individuals who are already in a bankruptcy plan can modify based on new calculations. This same plan allows current bankruptcy filings to be extended. Currently, these changes are valid for one year, until March 27, 2021.
However, it is important to note that the laws and regulations are constantly changing, so it is unclear whether or not additional changes will soon be implemented.
How to Navigate a Bankruptcy Case During COVID-19
Bankruptcy can be overwhelming on its own. With numerous types of bankruptcies and a large collection of required paperwork, it can feel like a second job as you attempt to navigate the New Jersey bankruptcy claims process. When you add in the ongoing changes that come with COVID-19, it can make the whole process even more confusing.
The lawyers at Silverman & Roedel are constantly following the latest changes and helping our customers navigate bankruptcies during this difficult time. Whether you are active in a bankruptcy filing or you are considering filing for bankruptcy, now is a good time to reach out to one of our legal representatives. The details of each case differs, so it is important that we get to know you and your unique situation.
Contact a Clifton Bankruptcy Attorney for a Consultation About Bankruptcy in New Jersey Today
If you are struggling with debt, you may need a fresh start financially. An experienced bankruptcy and debt relief attorney can help you explore your options and determine the best course of action for you, your family, and/or your business. The experienced New Jersey bankruptcy lawyers at the Law Office of Silverman & Roedel, LLC understand the nuances of New Jersey and federal bankruptcy laws, so we can help you protect your interests. Call us anytime at (973) 772-6411 or fill out the online contact form to schedule a confidential consultation. We have an office conveniently located at 1187 Main Ave, #2C, Clifton, NJ 07011.
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.