The government is still sending out $1, 400 stimulus checks. Some are being issued directly to taxpayers who are owed additional money on their tax returns. Others are being sent to folks who typically don’t file taxes, but did this year to claim the stimulus money. For millions of Americans, another stimulus check is a huge relief. But for those considering bankruptcy, it can bring a whole new worry.
As a bankruptcy lawyer Memphis trusts, the question, “Will bankruptcy take away my stimulus check?” has become a common one. Below is some information that I hope eases your concerns about bankruptcy and your stimulus money. I also outline one of the best ways to become debt free in 2021. Read on to find out how.
Will I lose my stimulus check if I file for bankruptcy?
You’ll be relieved to hear that the Consolidated Appropriation Act (CCA), which was passed in December of 2020, includes protections for people who are in bankruptcy. “Recovery rebates” were added to a list of exclusions that can’t be taken during the bankruptcy process.
This means that, if you received a 2020 stimulus payment, it can’t be taken from you as part of your bankruptcy. As we move forward with additional 2021 stimulus payments, the CARES Act seems to continue these protections.
Whether you’ve received your 2021 stimulus check yet or not, it’s good to know you don’t have to worry about losing it. Plus, if you are considering filing for bankruptcy, your stimulus check presents a great opportunity to get out of debt permanently.
Here’s how to use your stimulus check to become debt-free.
If you are struggling with debt, chances are you plan to use your stimulus check to pay down things like credit cards or medical bills. Unfortunately, this is one of the biggest and most common mistakes I see people make.
Let’s say you have $25,000 worth of old debt that you’ve been trying to pay off for years, but progress is slow. Imagine what would happen if you used your government stimulus check to pay some of it off. Even if you have a $2,000 check, you’ve barely made a dent in your overall debt.
Now imagine what would happen if you instead used your stimulus check to file for bankruptcy instead. That one check could pay for a process that wipes out most (if not all of) your debt. Then, once you’re through the bankruptcy process, you have a clean financial slate for you and your family’s future. This is a much more powerful way to amplify the impact of your stimulus check.
Call a Memphis bankruptcy lawyer today for a FREE consultation.
If you’re in serious debt, consider using your stimulus check to file for bankruptcy. It will not only relieve your financial problems, it can also relieve your stress and worry. Contact us online or call (901) 327-2100 to find out how we can help. The consultation is absolutely FREE. One of our experienced bankruptcy lawyers will answer any question you may have, and create a plan that works for you.
After you’ve filed, you can focus on building your credit back stronger than ever, and enjoy a fresh financial start. Don’t wait; we’re here to help you achieve a debt-free tomorrow.