Tag: debt consolidation
If you don’t know what surplus income in bankruptcy is don’t feel that you aren’t as smart as the next person because most people don’t know what it means or how it is even possible. We hope this short video will explain things easier for you.
We have previously written about surplus income in bankruptcy in our blogs:
- CAN YOU REALLY HAVE SURPLUS INCOME IF YOU’RE BANKRUPT?
- BANKRUPTCY FAQ CANADA
- WHAT CAN I DEDUCT FOR SURPLUS INCOME IN BANKRUPTCY?
On the list of items that generally seems to be difficult for many individuals to understand is how there can be surplus income in bankruptcy. The reason for the confusion is because it has nothing to do with the normal usage of the word “surplus”, being “more than what is needed or used; excess”.
What is surplus income in bankruptcy?
Within a personal bankruptcy, the context is a measure of what a bankrupt has to pay to the Trustee month-to-month. It is one of the aims of the Canadian bankruptcy system to balance the discharge of one’s personal debt with the expectation of the creditors that they should be paid.
To allow Canadians to keep a basic standard of living during the personal bankruptcy procedure, the government features collection thresholds on income (after income tax as well as certain deductions) meant to enable the bankrupt to keep a basic standard of living while contributing an amount to the Trustee for the benefit of his or her creditors.
Exactly how is the surplus income in bankruptcy payment determined?
The surplus income payment is determined according to a prescribed surplus income calculation mandated by the federal government, without any distinction for the area somebody lives in. To learn exactly what your surplus income in bankruptcy obligation would be, if any, you need to speak to a Trustee.
Surplus income in bankruptcy thresholds are structured based on national “poverty line” stats and the thresholds are set regardless of what part of the country or city that you live in. Surplus income in bankruptcy has nothing to do with what you have left over in funds every month. It is a federal solution which takes your monthly after-tax wages or salary, allows for a specific number of non-discretionary expenses, and takes into account your family size. Your Trustee then inputs this information into the government mandated formula, to calculate your surplus income in bankruptcy obligation.
If you have too much debt, contact us
If you are an individual or company who needs to free themselves from the stress and strain of too much debt, and especially if you have been told your situation is hopeless, Ira Smith Trustee & Receiver Inc. can prepare and carry out the plan made just for you, to free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.
If you’re experiencing serious debt issues with the CRA, or for any reason, contact a professional trustee for a free, no obligation consultation. The Ira Smith Team does not try to write new insolvency law or tax law. Rather, we will evaluate your situation within the existing statutes, and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal. Starting Over, Starting Now you can be debt free with the help of a professional, licensed trustee in bankruptcy. Contact us today.
The rise of average student loan debt
Average student loan debt is getting out of control. Post-secondary education is effectively a need for today’s labour market. According to the Canadian Federation of Students in its paper titled: “The Impact of Student Debt”, unfortunately, since the demand for education has inflated, public funding did not keep up. Public funding shortfalls have resulted in the increased cost of post-secondary education being borne by students.
The growth in average tuition fees
From 1990 to 2014, the national average tuition fees have seen an inflation adjusted increase of over one hundred and fifty per cent (150%). In Ontario, tuition fees have grown over one hundred and eighty percent (180%). For most students—often having spent very little time active within the workforce, other than for part-time work—funding their education has become more and more troublesome.
Students now taking on higher levels of average student loan debt
Many students are now taking on increased levels of debt for their education. Students requiring a Canada Student Loan currently graduate with an average student loan debt of over $28,000. Keep in mind that this is an average, with the costs of graduate education resulting in higher debt levels. Relying on debt to finance education suggests that there is a delay in the full impact of high tuition fees till after graduation—when interest begins to be charged.
Societal issues caused by rising average student loan debt statistics
This impact is now exacerbated by the effects of the most recent recession and the rising trend of precarious, and even unpaid, employment. The broader effects of high levels of student debt on both the person and the general economy are now resulting in various issues:
- Young Canadians (15-24) accounted for over half of job losses over the last 5 years;
- Un and under-employment can cost the Canadian economy over $22 billion by 2031;
- In 2014, youth un and under-employment was twenty-seven per cent (27%);
- Thirty per cent (30%) of medical students expect to graduate with over $100,000 in student debt;
- Under-employment and work outside one’s field of study results in talent degradation, falling behind in ability, and lost networking opportunities;
- Canada has seen a fifteen per cent (15%) growth in Canadians under the age of 30 who still live in their parent’s home since 1981;
- Those with student debt have a fewer assets, savings or investments compared to debt-free peers.
Average student loan debt causes affect the Canadian economy
Starting out with huge debt and facing a weak labour market, this prevents graduates to fully take part within the Canadian economy. Student debt impacts career selections, even among professional school graduates in medicine and law. An estimate of unpaid internships is in the range of 300,000 graduates working with no pay.
Do you have too much debt? Then contact us now
If you are an individual or company who needs to free themselves from the stress and strain of too much debt, and especially if you have been told your situation is hopeless, Ira Smith Trustee & Receiver Inc. can prepare and carry out the plan made just for you, to free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life.
Student loan debt has its own set of unique rules and complexities within the Canadian insolvency scheme. If you’re experiencing serious debt issues, contact a professional trustee for a free, no obligation consultation. The Ira Smith Team does not try to write new insolvency law or tax law. Rather, we will evaluate your situation within the existing statutes, and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. Starting Over, Starting Now you can be debt free with the help of a professional, licensed trustee in bankruptcy. Contact us today.
DioGuardi Tax Law – The Introduction
Several months ago we first introduced you to Philippe DioGuardi, a Canadian tax lawyer – The Tax Lawyer; Even a High Profile Tax Fighting Tax Lawyer Has to Pay His Income Tax. He’s the high-profile tax lawyer of DioGuardi tax lawyers who portrays himself as a one-man bulldog lawyer crusader against the unfair tactics of the Canada Revenue Agency (CRA). Ironically, at that time, a Toronto Star investigation revealed that Philippe DioGuardi had his own tax problems with the CRA and he paid up; the DioGuardi tax law couldn’t create the DioGuardi tax amnesty magic or “change the game”, to quote his own radio ads.
DioGuardi Tax Law – The Change
Recently I noticed that Philippe DioGuardi, a prominently featured DioGuardi tax lawyer, was no longer featured in the radio ads. Instead, they are being voiced by his father Paul DioGuardi. The ads are now very low-key, with none of the old bluster and bravado. And, I wondered why DioGuardi tax law no longer featured Philippe DioGuardi, the tax lawyer in Toronto.
That is until I read the latest Toronto Star article about him stating, “Self-styled tax fighter Philippe DioGuardi has been given a six-week suspension, a $5,000 fine and an order to pay $75,000 in legal costs after being found guilty of professional misconduct by the Law Society of Upper Canada” (LSUC). So LSUC found law society misconduct charges were proven and assessed a tribunal penalty and didn’t buy into the DioGuardi tax law concept of income tax law, as written by Philippe, and so he has a brief rest from the practice of law – a twist on DioGuardi tax amnesty!
DioGuardi Tax Law Professional Misconduct
The law society lawyer was successful in proving, according to the Order Summary of the Law Society Tribunal Philippe Joseph Mario DioGuardi (1990), of the City of Mississauga was found to have engaged in professional misconduct for:
- failing to act with integrity by having eight clients execute a Retainer Agreement which contains terms that benefit DTL to the potential detriment of the tax debtors clients;
- between April 2007 and October 2012, failing to deposit client money retainer funds received from six clients into a trust account or transferred the client retainer money from the trust to general within a few days of receipt of the funds prior to the performance of any or very little legal services for which he was retained;
- transferring the retainer client funds paid by a client into DTL’s general account within a few days of receipt of the funds prior to the performance of any legal services for which he was retained;
- immediately transferring the retainer funds paid by a client into a third party trust account for the benefit of DTL alone rather than for the client’s benefit and the client no longer had ownership of the monies;
- failing to perform legal services to the standard of a competent lawyer in respect to six tax troubles matters.
DioGuardi tax law, as written by Philippe, is an interesting experiment. It may not be right, but it has certainly garnered a lot of attention.
If you have too much debt, contact us
Do you or your company have unpayable tax debts? Are you looking for unpayable tax debt solutions? If you are an individual or company who needs to free themselves from the stress and strain of too much debt, and especially if you have been told your situation is hopeless, Ira Smith Trustee & Receiver Inc. can prepare and implement the plan made just for you, to free you from the burden of your financial challenges to go on to live a productive, stress-free, financially sound life. This plan includes resolving unpayable tax debt solutions. We have vast experience in helping people and companies with a variety of financial challenges.
If you’re experiencing serious debt issues with the CRA, or for any reason, contact a professional trustee for a free, no-obligation consultation. The Ira Smith Team does not try to write new insolvency law or tax law. Rather, we will evaluate your situation within the existing statutes, and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. Starting Over, Starting Now you can be debt-free with the help of a professional, licensed trustee in bankruptcy.
Contact us today.
To access the 407ETR bankruptcy debt checklist, simply click on the picture either at the top or bottom of this blog. It will take you to our secure website for access.
407ETR Bankruptcy Debt: How did the Checklist come about?
407ETR bankruptcy debt was the topic of last week’s blog 407ETR DEBT SETTLEMENT: OUR NEWEST GUILT FREE WAY TO DO IT, we reported on the Supreme Court of Canada (SCC) decision in 407 ETR Concession Co. v. Canada (Superintendent of Bankruptcy), 2015 SCC 52 (CanLII) (the Moore Decision).
To summarize that decision, the SCC dismissed the 407ETR’s appeal because the discharge provisions of the BIA override the plate denial provisions of the Highway 407 Act.
We also reported that the effect of the SCC’s decision is that:
- Pre-bankruptcy amounts owed to 407ETR are deemed to be provable claims under the BIA and can no longer be collected through plate denial under the Highway 407 Act following a customer’s discharge from bankruptcy
- Where a person has been discharged from bankruptcy and has pre-bankruptcy amounts in plate denial, which are provable claims under the BIA, 407ETR will credit these amounts (plus interest and fees incurred on those amounts) on the person’s 407ETR bill, upon receipt of a Notice of Bankruptcy, and an Order of Discharge or a Certificate of Discharge.
In both cases, once the amount owing is credited, then the person is free to obtain plate renewal from the Province.
But the Court won’t tell me how to get my plate after getting rid of my 407ETR bankruptcy debt!
That is all well and good, but the SCC did not and would not tell the “man on the street” how to go about having the combination of the 407ETR and the Province of Ontario reflect all this and issue a new vehicle plate registered in the name of the discharged bankrupt. So we did!
Where do I get these tools?
We prepared a checklist so that discharged bankrupts and their advisors will have a roadmap as to what needs to be done and what tools are required in order for 407ETR and the Province to have the proper information in order to amend their records and allow for the vehicle plate registration.
To access the 407ETR bankruptcy debt checklist, simply click on the picture either at the top or bottom of this blog. It will take you to our secure website for access.
Do you have too much 407 debt and other debts?
Instead of going deeper into debt seek the help from a professional trustee, even if you’re not considering bankruptcy at this stage. A trustee in bankruptcy will evaluate your situation and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. With immediate action and the right plan the Ira Smith Team can solve your financial problems Starting Over, Starting Now. We’re just a phone call away.
407 ETR debt settlement
This 407 ETR debt settlement blog was reviewed earlier this week by Mr. Brian Empey, Partner, Goodmans LLP. We wish to express our thanks to Mr. Empey who made a valuable suggestion which we incorporated.
We have updated this blog for 2018 where 407 ETR has implemented some changes. Check out our blog 407 ETR RATES: THE ONLY 407 ETR RATES DEBT SETTLEMENT PLAN GUARANTEED TO ACTUALLY WORK for the update.
In January 2014 in our blog titled 407ETR FAIRNESS-ONTARIO COURT OF APPEAL ENSURES FRESH START we described to you the decision of the Court of Appeal for Ontario in 407 ETR Concession Company Limited v. Superintendent of Bankruptcy (In the Matter of the Bankruptcy of Matthew David Moore) (the Moore Decision).
The highway’s owners appealed that decision to the Supreme Court of Canada (SCC). On Friday, November 13, 2015, the SCC released three decisions all dealing with the same basic issue: does the federal Bankruptcy and Insolvency Act (BIA) take paramountcy over provincial laws purporting to deal with the issue of debt and bankruptcy in Canada. The SCC answer was a resounding YES!
What did the SCC decide about the provincial law about 407 debt settlement?
The SCC dismissed the appeal of the ETR. The SCC considered whether the plate denial provisions of the Highway 407 Act conflicted with the discharge provisions of the BIA. ETR’s position was that provincial law about plate denial should apply following a person’s discharge from bankruptcy. The Attorneys General for several provinces, including the Province of Ontario, advanced positions in support of the provinces’ jurisdiction to legislate in vehicle licensing.
The SCC’s decision upheld the Moore Decision which found that the discharge provisions of the BIA override the plate denial provisions of the Highway 407 Act.
What is the effect on ETR debt settlement?
The effect of the SCC’s decision is that pre-bankruptcy amounts owed to the ETR are deemed to be provable claims under the BIA and can no longer be collected through plate denial under the Highway 407 Act following a customer’s discharge from bankruptcy. Therefore, 407 etr debt settlement is possible.
Where a person has been discharged from bankruptcy and has pre-bankruptcy amounts in plate denial, which are provable claims under the BIA, 407 ETR will credit these amounts (plus interest and fees incurred on those amounts) on the person’s 407 ETR bill, upon receipt of a Notice of Bankruptcy, and an Order of Discharge or a Certificate of Discharge.
In both cases, once the amount owing is credited, then the person is free to get plate renewal from the Province.
What will 407 ETR do next?
407 ETR must and is abiding by the SCC decision. They will set up a protocol whereby those who have already been discharged from bankruptcy and have been denied a plate renewal will be able to prove they have been discharged, get the 407 ETR debt, including penalty and interest, reversed, and get a plate renewal.
Those who are still in the middle of their bankruptcy proceedings and not yet discharged will be able to apply to have a plate renewal, once they are discharged from bankruptcy and prove it to 407 ETR.
Interestingly enough, there was no evidence whatsoever in any of the Court cases, including this one before the SCC, as to the 407 ETR’s right to deny anyone credit. When you get your transponder, the 407 ETR is actually extending credit to you, in the form of use of the toll highway in return for the toll charges they expect you to pay. It is no different from the bank loaning you money, and expecting you to repay it in full, with interest.
Will 407 ETR deny extending credit to discharged bankrupts? Will they only issue a new transponder to discharged bankrupts who give them a large cash deposit so that use of the 407 ETR will only be on a “cash and carry” basis? We don’t know, they have so far been silent on the issue, but it is still early in the game.
Do you need 407 etr debt settlement and a plan for your other debts too?
Instead of going deeper into debt seek help from a professional trustee, even if you’re not considering bankruptcy at this stage. A trustee in bankruptcy will evaluate your situation and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. With immediate action and the right plan, the Ira Smith Team can solve your financial problems Starting Over, Starting Now. We’re just a phone call away.
Grey divorce support groups need to show you the sticker shock!
According to Statistics Canada, “grey divorce” has been steadily growing among those 55 and over and “gray divorce” has been growing for Americans 50 and older. Regardless of the gray vs grey spelling, the issues are the same on both sides of the border.
Canadians are struggling with debt, even those that are married and have the advantage of two incomes. However, once you separate your finances from one another and create two independent lives and lifestyles, the sticker shock sets in.
Grey divorce support groups know this only too well from their experience of counselling many who have come down this path before you. Housing is the most expensive item to fund and maintain on your own; and all of the other expenses that were essentially shared, are now the financial burden of one instead of two.
Grey divorce support groups need to teach you what Investors Group has to say
According to Investors Group:
- 80% of grey divorcees (people who divorced at the age of 50 or older), say they will delay retirement because they need to work longer than planned
- 62% say their post-divorce savings and investments will no longer be adequate to fund their retirement
- 54% of those who divorced at or past the age of 50 found it difficult to make financial decisions surrounding their divorce
- 53% had to adjust their retirement plans
- 47% will have to scale back on their anticipated retirement lifestyle
- 26% no longer have enough retirement savings
Grey divorce support groups need you to understand your true income needs
As a result of grey divorce many Canadians are not only to delaying their retirement plans, they are falling into debt and dealing with it by accumulating more debt. This is a recipe for financial disaster.
Contact us today
Instead of going deeper into debt and just putting your head in the sand like an ostrich, heed the advice of your grey divorce support groups and contact us today. Seek the help from a professional trustee, even if you’re not considering bankruptcy at this stage. A trustee in bankruptcy will evaluate your situation and help you to arrive at the best possible solution for your problems, whether that solution is a bankruptcy alternative like credit counselling, debt consolidation or a consumer proposal or bankruptcy. With immediate action and the right plan the Ira Smith Team can solve your financial problems Starting Over, Starting Now. We’re just a phone call away.
When do people generally want information about personal bankruptcy alternatives?
Personal bankruptcy alternatives are always sought after an economic downturn. The economic downturn is causing more people to rely on credit to supplement their income and/or their lifestyle. This mountain of debt will ultimately result in bankruptcy or hopefully, an alternative to bankruptcy.
What Bank of Montreal and Statistics Canada say about Canadian household debt
In BMO’s Annual Debt Report, the average household debt of those surveyed is $92,699, more than $4,000 higher than the four-year average dating back to 2012. And servicing that debt, which includes mortgages, lines of credit and credit card debt, is costing $1,165 a month.
According to Statistics Canada:
- The debt-to-income ratio of Canadian households is 163.3% which means for every dollar Canadians earn, they owe $1.63 in debt
- Canadian households now owe $1.841 trillion in various forms of debt
- More than $1.1 trillion is from mortgages
- $519 billion is consumer debt, like credit cards
Debt + More Debt = a Solution?
Adding debt to more debt is not a solution to the problem; it compounds the problem. If you are using credit cards to supplement your income or your lifestyle, you have a serious problem that needs professional help. Don’t wait until bankruptcy is your only option. You should be learning about personal bankruptcy alternatives before it is too late.
Is there such a thing as bankruptcy solutions?
We are asked this question all the time. Before even considering bankruptcy, I always want to discuss 3 formal alternatives to personal bankruptcy:
- Credit Counselling
Credit counselling is in reality debt counselling. Professionals provide assistance with a host of issues related to debt including budgeting, finding debt solutions, working with your creditors and rebuilding credit. - Debt Consolidation
Debt consolidation is a single loan that allows you to repay your debts to several or all of your creditors at once, leaving you with only one outstanding loan. - Consumer Proposals
Consumer proposals are formal offers made to your creditors under the Bankruptcy and Insolvency Act (BIA) to modify your payments. e.g. paying a lesser amount each month for a longer period of time and paying a total lesser amount than you owe, all on an interest-free basis!
In addition there are informal personal bankruptcy alternatives including budget review, contacting your creditors (including your mortgage lender), selling an asset and contacting the Federal Government’s Repayment Assistance Plan (if you’re having difficulty repaying your student loan debt).
Just ask your Toronto bankruptcy trustee
A professional trustee can open up a world of possibilities for you. Contact Ira Smith Trustee & Receiver Inc. for help with your financial problems. With just one phone call you can be well on your way to a debt free life Starting Over, Starting Now.
What happened to David Cassidy?
This YouTube David Cassidy video says it all. His bankruptcy, notwithstanding he refutes it, must be related in some small part to his alcoholism and the several David Cassidy DUI events. The US Bankruptcy Court has ordered that he now must have his Florida home sold by auction.
For those of you too young to remember him, here is the link to the David Cassidy bio. As you can see, he was a huge music and television star heartthrob. Whatever happened to him over the years, David Cassidy now must pull his life back together. Like all of us, he must learn to live within his means and budget properly. Mr. Cassidy certainly isn’t the first, and won’t be the last celebrity having financial problems.
Next Steps
So who knows? Maybe Mr. Cassidy will have to go back on tour with a Partridge Family revival tour, or at least a David Cassidy tour, to earn extra income! Like all of us, he will have to learn to live within his means. Dealing with his personal problems will also be a great new beginning for him.
And what if you were not famous but are struggling?
If you’re struggling to support a lifestyle you can no longer afford, take immediate action and contact a professional trustee and explore your alternatives to bankruptcy. There are alternatives to personal bankruptcy – credit counselling, debt consolidation and consumer proposals. However, regardless of the choice that’s right for you, a balanced budget is always part of the equation. As we’ve stressed before, a balanced budget is to financial health what a balanced diet is to physical health. You’ll have to take a realistic look at your lifestyle and a serious look at your big ticket items – luxury home(s), exotic vacations, luxury cars, designer clothes and expensive entertaining and start living within your budget in order to benefit from one of the alternatives to bankruptcy .
The Ira Smith team approaches every file with the attitude that corporate or personal financial problems can be solved given immediate action and the right plan. Contact us today and Starting Over, Starting Now you can be on the path to a debt free life.
Alternatives to bankruptcy
Our insolvency clients, be they personal or corporate, usually want to start a consultation by asking us bankruptcy questions. However, I first start by obtaining a full understanding of the person’s or company’s financial challenges, so that we may consider all of the realistic options before discussing the topic of bankruptcy. I first wish to find the best alternative to bankruptcy.
I am finding now that many families, even high earners, are struggling in the “new economy”. We’ve spoken about their plight in our blogs:
There is yet another group that is now in great danger of bankruptcy – families whose previously very healthy income has taken a serious downturn and are now struggling to maintain a lifestyle they can no longer support. These families need to act fast and consider their alternatives to bankruptcy before it is too late to take remedial action. The natural inclination is to tough it out and hope for better times, but serious financial times demand serious financial decisions, not a hope and a prayer. As these families wait for better times to come they are burning through whatever savings they have, going further into debt by living off credit and will eventually run out of both money and credit.
This is not the best approach. At the first sign of financial trouble, these families should seek the advice of their legal counsel or accountant. These trusted professionals will be able to refer the families in financial trouble to a trustee in bankruptcy that they trust. With the trust factor bridge now in place with the trustee, that trustee can review the situation and provide the families with their realistic alternatives to bankruptcy.
If you’re struggling to support a lifestyle you can no longer afford, take immediate action and contact a professional trustee and explore your alternatives to bankruptcy. There are alternatives to personal bankruptcy – credit counselling, debt consolidation and consumer proposals. However, regardless of the choice that’s right for you, a balanced budget is always part of the equation. As we’ve stressed before, a balanced budget is to financial health what a balanced diet is to physical health. You’ll have to take a realistic look at your lifestyle and a serious look at your big ticket items – luxury home(s), exotic vacations, luxury cars, designer clothes and expensive entertaining and start living within your budget in order to benefit from one of the alternatives to bankruptcy .
The Ira Smith team approaches every file with the attitude that corporate or personal financial problems can be solved given immediate action and the right plan. Contact us today and Starting Over, Starting Now you can be on the path to a debt free life.
http://youtu.be/qcr1ga9Jtw4
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