Bankruptcy

Why Your Tax Forms Are So Important to Your Attorney

By info

When you work with an attorney on a bankruptcy filing, there?s a long list of documents you?ll be asked to gather and give to your attorney. Some of the most critical documents you?ll gather are your last three years? worth of tax filings, both state and federal. Why are these so important?First, and most important, tax returns contain a great deal of the financial information that your attorney will use when preparing your bankruptcy petition. Your attorney will review your returns to get a good foundational grasp of your financial situation?what real estate you own and whether it?s investment property; what bank accounts or investments you may hold; whether you are self-employed and how the business has been doing over time, and so on.

Similarly, your attorney uses your tax returns as a kind of financial checklist when preparing your bankruptcy petition. Most of the information that you?ve already reported on your tax returns is information that your attorney must include in your petition.

Importantly, bankruptcy is information-based. In other areas of law, when you go to court, you may be asked to testify and tell your side of the story. At your bankruptcy hearing, your bankruptcy petition?the specialized financial report that your attorney has presented to the court for approval?tells your story for you. The bankruptcy trustee who examines your petition may ask some questions, but the more accurate and detailed your attorney?s information, the easier it is for the bankruptcy trustee to review and approve your petition.

So don?t flinch when your attorney asks for copies of your tax returns. You can share them confidently, knowing that your attorney is helping you toward bankruptcy?s ?fresh financial start.?

The forgoing post was drafted by Attorneys Marsha Graham and Liz Weishaar who work in an of counsel relationship with the Law Office of Goldstein and Clegg, as well as for Weishaar and Graham.

Full post as published by Bankruptcy Articles & Blog on March 01, 2010 (boomark / email).