Podcast: Play in new window | Download | Embed

Subscribe Apple Podcasts | RSS | Subscribe:

Straight from the files of real estate law, bankruptcy, and investment, we want to share an interesting personal story about a recent undertaking that blended all three of these areas. Our hope in sharing this story is that it will shed some light on the process for others aspiring to have similar endeavors. The process is not without risk, but if done right, the payoff can be big.

Finding the Property

Late last year, we were contacted by a bankruptcy lawyer who was representing a bank trying to foreclose on a specific piece of property where the borrower was in default. The borrower had gone through several bankruptcy tactics and was now delaying foreclosure. Our acquaintance was about to have the stay lifted so they could foreclose on behalf of her small out of town bank. The bank had asked the attorney to find someone who would buy the note and just take over the foreclosure and repossession process for the property.

Getting the Property

In the end, there was an arrangement put in place for a company we owned to buy the note from the bank and take over the bankruptcy process. Although the process was complicated and at times drawn out, we got the automatic stay in bankruptcy which then prevents foreclosures from occurring while someone is in bankruptcy. The automatic stay prevents foreclosures until such a time as the judge allows it. We went through the process, got the judge to approve it, and then received the right to foreclose.
Although the debtor did try to do several things to stop the foreclosure, they were unable to do so. We then got the order to lift the stay and then posted the property for foreclosure. We then conducted a foreclosure sale, where as the holder of the note, we were allowed to credit bids. This enabled us to bid up to the amount of the debt including:

• Unpaid interest
• Attorney’s fees
• Related costs

By that time, with the attorney’s fees, because of the bankruptcy and interest running at a default rate, the balance owed was enough that nobody else bid and we were able to bid and eventually became owners of the property.

Property Evictions

As new owners of the property, we had to go through the process of evicting the occupant. The next step was to hire eviction counsel, file the papers and serve them on the property. By having a process server tape the papers to the wall and also send letters to the debtor and the property, it then triggered a thirty-day clock where the occupant had thirty days to leave the property. Fortunately, the occupant called us on the thirtieth day and said they were turning over the property.
Had the occupants not turned over the property within the thirty-day time period, we would have had to go to court and either have them evicted or get a judgement saying the occupant had no right to be on the property. Then, if necessary, a constable would have gone out to the property and physically removed the occupant. Luckily it did not come to that.

Renovating and Selling the Property for Profit

The property was not horrible, but it was definitely not clean either, so we spent several days hauling out trash and then began painting and cleaning and getting ready to put in new floors so the property could go on the market soon.

The project became a family affair as my wife is a real estate agent and helped take on many of the responsibilities of improving the property and staging it in a way that makes it more marketable.

The property is now awaiting a few final touches and inspections before it goes on the market. The endeavor has been a mixture of bankruptcy, real estate law, real estate investment, and real estate marketing. It is an adventure that we are glad we signed on for because although we have helped with legalities of situations like this before, going through it personally has given us a firsthand perspective that will only add to us successfully representing similar cases in the future.

Podcast: Play in new window | Download | Embed

Subscribe Apple Podcasts | RSS | Subscribe:

While estate and financial planning matters can be textbook situations much of the time, there are unique circumstances such as the incarceration of oneself or a loved one that can make the process more challenging, yet still critically important. For situations like these, the soon to be incarcerated need the help of a reputable and experienced estate planning attorney.

Why the Incarcerated Need Estate and Financial Planning

Even those individuals who are about to be incarcerated need estate, personal, and financial planning to protect themselves and/or the family they leave behind. Leaving behind regular daily life for that of one behind bars provides a fair amount of disruption to normal practices, and that requires being proactive in getting things in order before incarceration takes effect.

4 Types of Estate Planning That Should Take Place Before Incarceration

When living in a prison, it provides substantial challenges in protecting one’s own life as well as that of their loved ones, which is why estate planning practices such as the following are key:

1. Drawing up a will. If the individual that is soon to be incarcerated does not yet have a will in place, it is essential to do. This is particularly important should the individual or their spouse pass away while the convicted is in prison.
2. Giving consideration to the passing of a spouse outside the prison. Just as getting one’s own affairs in order protects them, it is equally crucial to consider what would happen if the spouse taking care of things at home passes away while the individual is serving their sentence. It requires carful thought before incarceration officially begins because without it, a person’s intended wishes may not be able to be honored.
3. Preparing healthcare documents. Also on the list should be healthcare planning such as a power of attorney for healthcare. This legal document typically allows another person (in this case probably the spouse, mother, father, brother, sister, or child of the incarcerated) to make a decision regarding the convicted person’s healthcare. This may look like the ability for them to decide whether or not to do a surgery, what hospital to go to, or whether or not to have a medical procedure should the incarcerated suffer an accident, heart attack, or similar condition. Having a power of attorney for healthcare in place allows the individual’s wife, mother, son, or whomever they appoint to make those medical decisions for them. Without this document in place, a warden or the medical staff of the prison may be the ones to make these decisions for the individual.
4. Protecting the spouse of the incarcerated with estate planning. It is important to note that if a husband and wife have an arrangement in which the wife designates the husband to make medical decisions for her, but he then goes to prison, matters can become muddled quickly. For this reason, most legal counsel recommends that a document be drawn up and put in place ahead of time that stipulates that while the husband is incarcerated, the wife’s mother or sister or whomever can take over those decisions in his place.

If you or someone you love could possibly be incarcerated, it is vital to begin getting their affairs in order as soon as possible. Equally as important is giving this task to an attorney who intimately understands how to rethink run of the mill estate and financial planning and apply them to more unique circumstances such as incarceration. Look for a lawyer that has experience in this particular area of estate planning for higher confidence in the process.

When an individual is set to go to prison, one of the best gifts they can give the loved ones they leave behind is to have their own and their spouse’s affairs in order before serving their sentence. This helps all parties feel less encumbered by what are already highly emotional and distressful circumstances.

Podcast: Play in new window | Download | Embed

Subscribe Apple Podcasts | RSS | Subscribe:

Even when a person is accused of or charged with a crime, there are no accepted delays in paying taxes for criminals. Everyone in the United States is required to file tax returns for any income that they make regardless of where that income comes from. This is also applicable to criminals, making taxes for criminals a bit of a niche in the tax practice world.

Why Taxes for Criminals Must Be Filed

In many cases that tax lawyers deal with, there is a person or people who have committed some sort of a crime, financial or otherwise. Just because an individual commits a crime and may be facing incarceration does not prevent them from having to file tax returns. In addition, it could cause more headaches for the person in the following instances:

1. Plea Bargains and Parole. Not only are criminals not excused from filing taxes, but if they do not file their returns, it could also affect their case. For example, if an individual agrees to a plea bargain or seeks parole or some other form of relief, they must ensure they are indeed current on their tax returns.
2. New Charges. There can be some instances in a which a person is accused of a crime, but the government may not be able to prove beyond a shadow of a doubt that they committed the crime. This could open the door to the Internal Revenue Service, FBI, or other government entities to change tactics and instead prove that the person in question committed tax fraud by not reporting profits from whatever money-making enterprise they are or were connected to.

The bottom line is that taxes for criminals must still be completed and filed because it is simply the law. It also could become a significant obstacle to their freedom in the long run.

Cases Where the Accused’s Failure to Pay Taxes Worked Against Them

New charges for tax evasion have sometimes famously occurred throughout history and turned out to be the undoing for the accused.

One of the most famous people of note in this situation was Al Capone, a Chicago businessman and alleged gangster during the Prohibition Era. Although many suspected Capone was involved in illegal bootlegging, authorities were unable to prove it. Despite the government not being able to charge Capone with prohibition violations for the illegal sale of alcohol, they were instead able to prove that he was guilty of making money and not paying taxes on that income. Ultimately, Capone was charged with twenty-two counts of tax evasion.

How A Tax Attorney Can Help with Taxes for Criminals

Despite many criminals having problems other than that of taxes, they are still required to file a tax return, and it is in their best interest to do so.

For example, if a person is accused of being involved in a hitman scenario, it is likely that a trial will be held to determine if that individual played an illegal role. Should the authorities be unable to prove the individual’s involvement in the hitman scenario, they may switch tactics by evaluating the individual’s tax returns.

Whether or not it can be proved that the individual made $200,000 from a hitman deal or not, the fact may still remain that the individual made $200,000. As stated before, tax returns are used to declare income wherever it comes from. This individual needed to do a tax return for this amount in order for it not to be an additional legal issue.

While some certified public accountants may be tempted to turn down helping this individual get their tax returns in order, most tax attorneys understand the fact that the individual still has an obligation to pay and report their taxes since they made the $200,000. An accountant could help with the W-2 and home mortgage and record the income and file an official tax return.

Although this is indeed a benefit for the accused by keeping the Internal Revenue Service or Justice Department from prosecuting them for failure to file a tax return and ultimately tax evasion, a tax attorney knows that completing and filing the tax return serves the federal tax system.

In a slightly different scenario of plea bargaining, a tax attorney may also be able to help. It is essential that an individual who has been accused of a crime and wants to begin the plea bargain process in the federal criminal system must be current on their tax returns. Again, certified public accountants may shy away from this type of assistance, but a knowledgeable tax attorney understands that the person still needs to pay their taxes and file the returns and can assist the individual in doing so. The attorney can complete an honest and accurate tax return and present it to the taxpayer, their criminal lawyer, and ultimately the justice department.

At this point, if the taxpayer is able to make payment on the return so that any tax related obstacles to plea bargaining or other sentencing implications are removed, they should do so. This in turn allows the justice department and criminal defense attorneys to work with the case at hand instead of having to focus on other issues such as those that may be tax related.

Taxes for criminals are an area of law that tax attorneys should be equipped to handle. This assistance may be helpful not only in their current circumstances as they face incarceration but will also be helpful to them when they get out of prison or complete whatever punishment they are given and rejoin society. Their tax returns will be current and prepared. This keeps them from having to scramble to complete returns that lapsed since their pre-incarceration period.

While a criminal can’t benefit from filing taxes, it is required by law to file them. A reputable tax attorney assisting with taxes for criminals can also serve a function for government and society in general by allowing the criminal and tax systems to work efficiently.