While most bankruptcy cases involve people who have an income of $30,000 or less annually, many high-income earners also personally file. Those high-income earners who file for bankruptcy include the business owners, athletes, investment bankers and celebrities you hear about in the news.
Regardless of income, through a personal bankruptcy, a debtor can eliminate or greatly reduce outstanding debts. High-income earners have the option to file for Chapter 11 bankruptcy, allowing them to eliminate substantial debts through a repayment plan agreed upon by the parties involved. Sometimes these debts can total millions of dollars, leaving the person with few options other than bankruptcy.
Aside from a Chapter 11 bankruptcy, if you do not meet income requirements, you may be able to file a Chapter 13 bankruptcy. If you are struggling with outstanding debts, you may be able to enter into a payment plan with creditors, allowing you to keep certain assets including properties and vehicles. Speak to our bankruptcy attorneys about the plan that would work best for your situation.
Why Would a High-Income Earner File for Bankruptcy?
A high-income earner may file for bankruptcy for reasons including job loss, taxes, divorce, death or legal difficulties. Additionally, people who have large sums of money may run into financial issues with friends, family members or business partners, who help them get involved in bad investments.
We recently read an interesting story on CNN.com about former NBA All-Star Antoine Walker, who had to file for bankruptcy after earning more than $108 million during his basketball career. Walker explained how his money dried up on items like cars, jewelry and homes. The recession also caused his Chicago real estate firm to go under, with banks forcing him to pay back more than $20 million on properties that went unsold.
Walker also said he gave large sums of cash to his friends and family members. “I gave them whatever they wanted and spoiled them. You can’t do that,” Walker said, according to CNN. “It ended up being an open ATM throughout my career.”
Walker now works for a company that teaches financial literacy to young athletes, warning them about bad investments. “My story is sad. It’s sad to see other guys work so hard throughout their life — and then they just lose it in two or three years,” Walker told CNN.
Ask Our Lewisville Bankruptcy Attorneys about Eliminating or Reducing Your Debts
As Walker’s case shows, regardless of your income, you can still run into financial complications. If you are thinking about filing for bankruptcy, you will need experienced legal counsel. Our Lewisville bankruptcy lawyers can guide you through this process and help you recover financially.
Shuster Law Firm PLLC – Lewisville Bankruptcy Attorneys