Deck 8: Liabilities, and Required Documents

Question 1

Charitable donations up to ________ are permitted under §548.

A) ten percent
B) fifteen percent
C) twenty percent
D) five hundred dollars per month if the client is below the state median income, and seven hundred if above.

Answer 1

fifteen percent

Question 2

Since retirement accounts are exempt, deductions from paystubs for a pension have no effect on a bankruptcy filing.

Answer 2

False

Question 3

Fearful of a stock market crash, Laila withdrew $10,000 from her IRA and placed it in her checking account. After a few months where Laila realized there was no issues with the stock market, she redeposited $5,000 in her IRA account and transferred the remaining $5,000 to her savings account in case of an emergency. What issues, if any, exist if Laila files soon for bankruptcy?

Answer 3

Retirement accounts are exempt, whether Chapter 7 or 13, but if the funds are commingled or placed in a non-exempt account, then those funds may not be protected. Laila should deposit the remaining funds into the retirement account and have documentation regarding the withdraw and deposit amounts.

Question 4

The debtor purchased an $800 television two months before filing bankruptcy. This may violate §__________.

A) 521.
B) 522.
C) 523.
D) 524.

Question 5

The debtor had a cash advance of $1,200 approximately six months ago, and the funds were used to catch up with the rent. This automatically violates §523.

Question 6

To determine when a credit card was opened, the best way to obtain that information is by:

A) asking the client directly.
B) the client's credit report.
C) calling the creditor.
D) none of the above.

Question 7

What limits are imposed on cash advances under §523?

Question 8

If a laptop is considered a luxury good under §523, what is the maximum value allowable, and within what timeframe?

Question 9

During the consultation, it becomes obvious that the debtor's bankruptcy needs to be filed quickly to avoid a garnishment on Friday of next week. When asked if the debtor has used his credit cards recently, he states that he spent $644 on groceries in the last two weeks. How would this affect the bankruptcy?

Question 10

Since the client listed a lawsuit in the intake, what issues should you address with the client?

Question 11

Clients should provide the following to obtain creditor information:

A) credit reports.
B) List of Creditors
C) statements and collection letters.
D) all of the above.

Question 12

By law, how many times a year are you allowed to obtain your credit report free of charge?

A) every twelve months.
B) twice a year.
C) depends on the credit service.
D) none of the above.

Question 13

The major credit reporting bureaus are:

A) Equifax
B) Transunion
C) Experian.
D) all of the above.

Question 14

If the client has provided credit reports and recent credit card statements, explain why the client should still provide the List of Creditors.