Wednesday, January 28, 2015

A collection notice for $20 ... are you kidding me?

Image courtesy of scottchan at
Unfortunately not ... this is no joke. I have clients that have small debts to list in their bankruptcy filings as well large debts. Many of the small debts ... $10 ... $20 ... $30 ... are medical co-payments or deductibles and they are being pursued. I suspect some people hope the creditor will go away for such a little amount as they chuck the notice into the trash.

I know many, many, many years ago I did when I threw away the notice from the "Music Club" for the CD's I promised to buy within the year and didn't. But it didn't ...  I ended up paying it and some ... a lot of debt doesn't just go away and even these small amounts can impact your credit report and score.

This article "A Debt Collector Came After Me for $8.97" ( explains the potential impact a small debt can have. The bottom-line you should deal with debt no matter how big or small. If you are considering bankruptcy or some other intervention like debt settlement, than you will deal with it accordingly. If not, you should probably consider paying it if you can; before it hits your credit report.

If you want assistance, legal representation, or just want to know more about Mark Medvesky or Medvesky Law Office, LLC, check out our website at

#bankruptcy #Chapter_7 #Chapter_13 #Montgomery_County #law_firm #Bucks_County #Pennsylvania #debt #settlement

Saturday, January 24, 2015

Debt What?

Image courtesy of Stuart Miles at
Like many bankruptcy attorneys, I suspect, I have had clients come into my office and talk about the horrible experience they had with a "debt management" company. They complained about high fees, large monthly payments and after a few months finding out only one creditor has been paid and several others have initiated law suits. As a result, they ended up in my office, a couple hundred or thousand dollars poorer and filing the bankruptcy they wanted to avoid anyway.

I've also had a client come in for something else and tell me how she used a "debt management" company that successfully reduced interest rates and lower payment making it easier to pay her bills off over a 5 year period. Unfortunately, she used every dime of her retirement money and was still working full-time at over 70 years old. I assumed it was just a matter of a good company vs. a bad company.

As a result, I started looking for a good "debt management" company for client's who want to try something before bankruptcy. During my research I came to discover there are two types of organizations and they are Credit Counseling/Debt Management organization and Debt Settlement companies. A Debt Management company walks people through their finances, determines if they have enough income to fund a budget, talk to the creditors, and negotiate repayment plans. The indications are that a repayment plan through a Credit Counseling/Debt Management Organization has minimum impact on a person's credit report - "Impact of debt management plan on your credit report and scores"

From what I understand, a Debt Settlement Company is a little more guerilla. They charge their clients larger fees. The companies take lists of creditors, collect payments from their clients, allow credit accounts become delinquent, and settle accounts individually as the company accumulates enough money through the debtor's payments. The creditors probably are not contacted until the settlement company is ready to negotiate a settlement. As a result, the creditors continue to try and collect the debt while the debtor is paying the settlement company. Once a debt is settled, it is marked "settled" on the credit report indicating it wasn't paid in full and further damages a debtor's credit report - "The Dangers of Debt Settlement"

These may be an alternative to bankruptcy under the right circumstances for the right clients. Credit Counseling/Debt Management could be helpful for someone who had a short stint of unemployment or a short but serious accident or illness; a difficulty that has a short life with little chance of recurring. This would minimize the impact on a credit report but could take years to pay the plan.

A Debt Settlement Company might work for someone who is already a few months behind on payments and only has a couple open credit accounts to deal with. I could see how someone would consider this method more convenient than bankruptcy.  This type of client should be ready for the credit of additional income to them. The creditor will probably issue a 1099-C reporting the cancelled debt to the IRS as income to the debtor.

While these may be viable options, I think bankruptcy, under Chapter 7, has its advantages. First, there are no further payments to creditors. Debtors free up current income immediately. The automatic stay stops creditors efforts to collect the debt immediately and the entire bankruptcy will usually take a few months. I think it alleviates the pressure on a client to withdraw retirement money. I recommend people not use retirement funds to pay debts because most retirement accounts are protected by bankruptcy law. Finally, any income reported to the IRS for the discharged debt may be avoided by filing an IRS Form 982 with that year's tax return.

If you feel like you are drowning in debt and start looking for options, make sure you do your research and understand your options. If you chose poorly, you will throw good money after bad and end up paying additional fees for no value. Making the right choice the first time gets your life back on track faster ... and ... remember for some people ... bankruptcy may be your only real option.

If you want assistance, legal representation, or just want to know more about Medvesky Law Office, LLC, check out our website at

Other articles to read:
"Revisiting Debt Settlement (Again?)"

NOTE: Some of this information comes from a conversation I had with an owner of a local Credit Counseling/Debt Management Organization that I come to believe to be reputable. I did not talk to anyone working with a Debt Settlement Company.

#bankruptcy #Chapter_7 #Chapter_13 #Montgomery_County #law_firm #Bucks_County #Pennsylvania #debt #settlement

Wednesday, January 21, 2015

USCIS Announcement - Reminder for Requesting DACA


To request Deferred Action for Childhood Arrivals (DACA) you must complete forms I-821D and I-765 and submit with required fees. You should submit your requests 150 to 120 before your expiration date and the USCIS goal is to process your application within 120 days. You can inquire about your status after your application has been pending for 105 days.

Full bulletin direct from USCIS:

"If you request either initial or renewal Deferred Action for Childhood Arrivals (DACA), you must submit Form I-765, Application for Employment Authorization and required fees. USCIS will reject your request if you fail to submit Form I-765, the required filing fee, Form I-765 Worksheet, and Form I-821D, Consideration of Deferred Action for Childhood Arrivals. For complete instructions on requesting DACA, go to the Consideration of Deferred Action for Childhood Arrivals (DACA) page.
For DACA renewals, USCIS strongly encourages you to submit your renewal request between 150 days and 120 days before the expiration date located on your current Form I-797 DACA approval notice and Employment Authorization Document. Filing during this window will minimize the possibility that your current period of DACA will expire before you receive a decision on your renewal request.
USCIS’ current goal is to process DACA renewal requests within 120 days. However, you may submit an inquiry about the status of your renewal request after it has been pending more than 105 days. To submit an inquiry, please visit or call the National Customer Service Center at 1-800-375-5283 (TDD for the hearing impaired: 1-800-767-1833)"

If you want assistance, legal representation, or just want to know more about Medvesky Law Office, LLC, check out our website at

#BucksCounty #DACA #Deferred_Action #Immigration #lawyer #lawyers, #MontgomeryCounty #Souderton #Law_Firm

Tuesday, January 20, 2015

Common Credit Score Myths

So many people talk about credit scores but I don't know how much we really know about them. Here is an article that explains "10 Common Credit Score Myths People Tell Me"
One of the facts the article discusses is the difference between a "hard inquiry" and a "soft inquiry":
"Myth 3: Checking my credit report or credit score will reduce my score.

Image courtesy of Stuart Miles at

FACT: So many of my clients have no idea what their credit score is because they thought checking it would hurt it. Looking at your own credit report or score isn’t like sneaking a peek at your notes during a test, you’re allowed to be in the know. While it’s true that if a lender checks your credit report or credit score, it results in a “hard inquiry,” which causes a small, temporary drop in your credit score. However, when you check your own, it’s called a “soft inquiry,” and it has no effect on your score." Not all inquiries impact your credit score.
Take a look at the article if this is a topic that interests you. Several point are good to know and others may really make you think about caring for your credit score. It is like most things in life; you have more control than you may realize.
Learn more about my firm Medvesky Law Office, LLC at
#bankruptcy #Chapter_7 #Chapter_13 #Montgomery_County #law_firm #Bucks_County #Pennsylvania #credit_score

Wednesday, January 14, 2015

New Scamming Industry growing ... targeting student loan debtors

If you have student loans or know someone who does, you know how much of a drag they can be on 
Image courtesy of David Castillo Dominici at
a person's finances. As student debt grows and people search out ways to limit its effect, fraudsters are developing a new scam to take advantage of those in trouble. If you have been paying attention to the news recently, you may have heard about the legal actions being taken against some of the companies duping unsuspecting and desperate debtors.

The scammers are basically offering to help former students enroll in government loan forgiveness programs. The companies are charging large fees for the services. The problem is the government offers free help for legitimate forgiveness programs. Here are two recent articles explaining the scams in a little more detail:

Blog: Pursuing student loan scammers -

Looking for student loan forgiveness, do your homework -

The problem is compounded by the fact student loans are extremely tough to discharge in bankruptcy. Sometimes discharging other unsecured debt in bankruptcy can free up cash to help pay student loans. Remember, if it sounds too good to be true... it usually is.

If you want assistance, legal representation, or just want to know more about Medvesky Law Office, LLC, check out our website at

#bankruptcy #Chapter_7 #Chapter_13 #Montgomery_County #law_firm #Bucks_County #Pennsylvania

Sunday, January 11, 2015

What do you mean I earned $4,000 when they repossessed my car?

So what happens after a car is repossessed and if the loan is forgiven ... or any loan is forgiven and what can the debtor do about it? This is a continuation to my blog post "Did you know a short sale of your home could create income for you? ... but not this year ..."
Image courtesy of Toa55 at

Normally, if a car is repossessed, it is worth less than the amount of the loan... it is underwater or upside down. The lender takes the car, sends it to auction and the sells it to the highest bidder. If the borrower had a loan on the car for $30,000 and the car sold at auction for $21,000, the borrower may still owe the lender $9,000. Many people think after the sale the car, the case is over. But in many cases, it is not. The lender may seek payment for the additional money. They can seek a "deficiency judgment."

Before this happens, a borrower can try to negotiate a voluntary repossession and ask the lender to forgive the deficiency. The second option is to pay the outstanding debt after the sale or the borrower can just ignore it ... for awhile. Finally, the borrower can negotiate to settle the remaining debt.

The point of this post is to talk about the consequence of debt forgiveness. So what happens if this debtor settles his deficiency debt for $5,000. That leaves a debt of $4,000, which is forgiven by the lender. Under the US tax code, the lender has to report that debt forgiveness/cancellation as income on a 1099-C to the debtor.

Let's also assume this debtor chose that year to clean up all his debt. So he settles $24,000 of additional credit card debt for $14,000 cancelling another $10,000 in debt. The result is the debtor will be credited $14,000 additional income for the year and pay more in income tax as well as what was paid to settle the debt.

One of the ways to avoid this credit is to file for bankruptcy and discharge the debt instead of settling it. In bankruptcy, a person can surrender a car and discharge the deficiency before it becomes income. A debtor would also discharge some or all of the credit card debt depending on the circumstances.

Another possibility in a case like the one described above would be to discharge the credit card debt possibly enabling the debtor to be able to pay for and keep the car. If the debtor has enough income to pay back part of the debt, he could file for Bankruptcy under Chapter 13.

By filing under Chapter 13, the debtor's income and budget would dictate the amount of payments creditors receive and not the creditors whim. A debtor not only avoids the debt he is unable to pay but the additional tax as well. I suggest bankruptcy offers the most protection and flexibility to debtors truly in over their heads in debt.

If you want assistance, legal representation, or just want to know more about Medvesky Law Office, LLC, check out our website at

Other articles to read:
1099-C surprise: IRS tax follows canceled debt -
6 exceptions to paying tax on forgiven debt -
Canceled debt tax notices riddled with problems, advocate says -


Friday, January 9, 2015

USCIS Issues Fliers About Executive Actions on Immigration

These initiatives have not yet been implemented -  Information to know to help clients not be scammed ...

Directly from USCIS:

"Two fliers on President Obama’s executive actions on immigration are now available on USCIS encourages stakeholders to use these fliers when communicating with the public about these actions.

The fliers explain:
  • The importance of avoiding scams and not submitting requests until the new initiatives are available.
  • Eligibility requirements for the expanded Deferred Action for Childhood Arrivals (DACA) and the new Deferred Action for Parents of Americans and Lawful Permanent Residents (DAPA)
The fliers are available in English, Spanish, Korean and Vietnamese. A Chinese version will be available soon.
USCIS is the official source of information about executive actions on immigration. Please visit and subscribe to our immigration action page for updates.
Important notice: These initiatives have not yet been implemented, and USCIS is not accepting any requests or applications at this time. Beware of anyone who offers to help you submit an application or a request for any of these actions before they are available. You could become a victim of an immigration scam. Visit our Executive Actions Resources page and subscribe to this page to get updates when new information is posted. "

If you want assistance, legal representation, or just want to know more about Medvesky Law Office, LLC, check out our website at

Thursday, January 8, 2015

USCIS Announcement: DHS Announces 18-Month Redesignation and 18-Month Extension of Temporary Protected Status for Syria

Directly from U.S. Citizenship and Immigration Services Daily Digest Bulletin: "WASHINGTONSecretary of Homeland Security Jeh Johnson has redesignated Syria for Temporary Protected Status (TPS) and extended the existing TPS designation for the country from April 1, 2015, through Sept. 30, 2016. This allows eligible nationals of Syria (or persons without nationality who last habitually resided in Syria) to register or re-register for TPS in accordance with the notice published today in the Federal Register.
Who is Eligible
Current TPS Status
When to File
Current TPS beneficiaries from Syria
Have TPS
To extend your TPS, you must re-register during a 60-day re-registration period that runs from Jan. 5, 2015, through March 6, 2015.
Syrian nationals and persons without nationality who last habitually resided in Syria, who have:
  • Continuously resided in the United States since Jan. 5, 2015, and
  • Been continuously physically present in the United States since April 1, 2015.
Do not have TPS
To obtain TPS, you may apply for TPS during a 180-day initial registration period that runs from Jan. 5, 2015, through July 6, 2015.
During the past year, the Department of Homeland Security and the Department of State reviewed the conditions in Syria. Based upon this review, Secretary Johnson determined that a redesignation and 18-month extension of TPS for Syria is warranted due to an ongoing armed conflict and extraordinary and temporary conditions in Syria that prevent its nationals from returning in safety.
Individuals re-registering for TPS:
Current Syrian TPS beneficiaries seeking to extend their TPS status must re-register during a 60-day period that runs from Jan. 5, 2015, through March 6, 2015. U.S. Citizenship and Immigration Services (USCIS) encourages beneficiaries to re-register as soon as possible once the 60-day period begins. USCIS will not accept applications before Jan. 5, 2015.
The 18-month extension allows TPS re-registrants to apply for a new Employment Authorization Document (EAD). Eligible Syria TPS beneficiaries who re-register during the 60-day period and request a new EAD will receive one with an expiration date of Sept. 30, 2016. USCIS recognizes that some re-registrants may not receive their new EADs until after their current EADs expire. Therefore, USCIS is automatically extending current TPS Syria EADs with a March 31, 2015, expiration date for an additional six months. These existing EADs are now valid through Sept. 30, 2015.
To re-register, individuals must submit:
·         Form I-821, Application for Temporary Protected Status (Re-registering individuals do not need to pay the Form I-821 application fee);
·         Form I-765, Application for Employment Authorization, regardless of whether they want an EAD;
·         The Form I-765 application fee, but only if they want an EAD (All individuals re-registering for TPS who want an EAD must pay the Form I-765 fee, regardless of their age); and
·        The biometric services fee if they are age 14 or older.
Individuals applying for TPS for the first time:
For Syrian nationals (and persons having no nationality who last habitually resided in Syria) who do not currently have TPS, the TPS redesignation may allow them to apply for TPS if they have continuously resided in the United States since Jan. 5, 2015, and have been continuously physically present in the United States since April 1, 2015. In addition, applicants must meet all other TPS eligibility and filing requirements.
To apply for the first time, individuals must submit:
·         The Form I-821 application fee;
·         Form I-765, Application for Employment Authorization, regardless of whether they want an EAD;
·         The Form I-765 application fee, but only if they want an EAD and are 14 to 65 years old (Those who are under age 14 or are age 66 and older do not need to pay the Form I-765 fee with their initial TPS application); and
·         The biometrics services fee if they are age 14 or older.
Individuals who still have a pending initial TPS application under Syria do not need to submit a new Form I-821. However, if such individuals currently have a TPS-related EAD and want a new EAD, they must submit:
·         The Form I-765 application fee, regardless of their age; and
·         A copy of the receipt notice for the initial Form I-821 that is still pending.
DHS anticipates that approximately 5,000 individuals will be eligible to re-register for TPS under the existing designation of Syria and estimates that approximately 5,000 additional individuals may be eligible for TPS under the redesignation.
Applicants may request that USCIS waive any fees based on inability to pay by filing Form I-912, Request for Fee Waiver, or by submitting a written request. Fee-waiver requests must be accompanied by supporting documentation. USCIS will reject the TPS application of any applicant who fails to submit the required filing fees or a properly documented fee-waiver request.
Additional information about TPS for Syria—including guidance on eligibility, the application process and where to file—is available online at The Federal Register notice published today contains further details about this extension and redesignation of Syria for TPS, including application requirements and procedures, and the automatic six-month extension of current TPS Syria EADs.

All USCIS forms are free. Applicants can download these forms from the USCIS website at or request forms by calling USCIS toll-free at 1-800-870-3676.
Applicants seeking information about the status of their individual cases can check My Case Status Online or call the USCIS National Customer Service Center at 1-800-375-5283 (TTY 1-800-767-1833)."
For more information about USCIS and its programs, you can visit or follow Twitter (@uscis), YouTube (/uscis) and the USCIS blog The Beacon"
If you want assistance, legal representation, or just want to know more about Medvesky Law Office, LLC, check out our website at

USCIS Announcement: Temporary Protected Status Extended for El Salvador

"Secretary of Homeland Security Jeh Johnson has extended Temporary Protected Status (TPS) for eligible nationals of El Salvador for an additional 18 months, effective March 10, 2015, through Sept. 9, 2016.

Current TPS El Salvador beneficiaries seeking to extend their TPS must re-register during the 60-day re-registration period that runs from Jan. 7, 2015, through March 9, 2015. U.S. Citizenship and Immigration Services (USCIS) encourages beneficiaries to re-register as soon as possible once the 60-day re-registration period begins. USCIS will not accept applications before Jan. 7, 2015...
For more information about USCIS and its programs, you can visit or follow Twitter (@uscis), YouTube (/uscis) and the USCIS blog The Beacon"
If you want assistance, legal representation, or just want to know more about Medvesky Law Office, LLC, check out our website at

Monday, January 5, 2015

Retirement Funds - Have you ever heard of the 4% rule?

Like many people, I haven't been focused on retirement either. Coming up on my second year of having my own office I have been more focused on paying bills and keeping things running. Also, I hope to work well into my 60's and maybe my 70's if I build a practice and firm that allows it. So I haven't paid much attention to retirement myself.

While I was going through the headlines on line-this weekend, I found this article: Retirement: Is the 4% rule still relevant? It talks about the rule of thumb that retired people should not withdraw more than 4% a year from their retirement accounts once they retire. Of course other factors need to be considered but it gives you a good point to start planning.

So why am I talking about it here? I'm not a financial planner and do not pretend to be. But I found it interesting. I never really knew how to value some of the benefits I've already vested in. After conversations with financial people, the only question I was asked, "How much do you need to live on in retirement?" I don't know ... one thing I do know is I don't plan to live in a 4 bedroom house after I retire and that is my biggest expense now.

But if I use this 4% rule, I know what I should be able to draw out of my saving and estimate a value to my other benefits. For instance, the way I see it anyway, a social security benefit of about $20,000 per year after I reach 65 y/o is similar to have saving $500,000 ($500,000 x .04). So if someone has this amount of benefit and they save another $250,000 in an IRA or 401K, they can plan about $30,000 a year in retirement funds and it is about the same as someone who saved $750,000 with no social security benefit (like someone who was self employed their entire work life).

But this also touches several parts of my practice. When people come to talk about estate planning... Wills, POA's and Trusts. This can give you an idea of what to put into a trust and what you can expect to have left when you pass.

Retirement funds are also relevant in divorce cases. Dividing the assets is part of divorce. This rule can be used to estimate how much a person will need to make up to retire after a divorce. It gives a point to begin new planning.

It is also important when we talk about Bankruptcy and debt. One of the mistakes people make when they are in debt is to start drawing down their retirement funds. Also, parents need to think about their retirement funds as they look to co-sign school loans or bail their kids out of other debt. So considering how much you need in saving to draw a decent monthly figure, bailing out s child with retirement money may not be your best option and co-signing a student loan, a non dischargeable loan, may be too big of a financial burden to accept.

So the 4% rule is a good starting point for a few different conversations. If a financial planner comes across this blog, I welcome further comment. I know I probably over-simplified this rule and retirement planning overall. But I still think a good place to start.

Learn more about my firm Medvesky Law Office, LLC at

Saturday, January 3, 2015

Infidelity ... the act itself is bad enough ... don't let the damage continue

Image courtesy of Stuart Miles 
We have had a few cases walk into the office recently where there has been an unfaithful spouse. Everyone handles it differently. Many times infidelity adds a whole new dimension to a divorce. The worse cases, from my perspective, are when the non-offending spouse allows the affair to continuously victimize him or her.

When that happens, the offended spouse either wants to be vindicated and hold the offending spouse up for ridicule in a public forum like court or wants retribution. This can create a stressful and expensive divorce.

Pennsylvania is a no fault divorce state. Infidelity does not generally play a big role in divorce (it can be a defense to spousal support and a factor in alimony). So if a couple has decided they cannot get beyond the unfaithful act, I try to get my clients to put the infidelity behind them and work on their future. Of course that is easy for me to say.

I found this article and it offers advice similar to what I have offered to clients myself:

10 Productive Ways To Move On After Infidelity (

I strongly agree with at least two points in the article:

1. Accept that the marriage is over. Stop emotionally investing in the past. The more you hold onto the past, the more you will recreate it in your present moment and in the future. Go through the logistics of separating your lives. Take off your wedding ring. Ask yourself honestly: Are you stalling the divorce process? Why? Do you feel scared to let go?"


"7. Forgive. Realize that forgiveness is really more for your benefit than for the other person's. As the famous saying goes: 'Holding onto anger is like drinking the poison and expecting the other to die.'"

It is hard for clients to make rational decisions in an effort to settle a divorce case when they are hoping it won't happen or when they are angry and want payback. If you know someone going through a divorce, let them know about this article. It could start some healthy dialogue and get them moving forward.  

Learn more about my firm Medvesky Law Office, LLC at