People run into serious financial problems for a variety of reasons: medical debt, mortgage debt, student loans, credit card debt and back taxes, to name only a few. That probably isn't news to a lot of people in Tennessee. It was recently reported that our state has the nation's highest bankruptcy filing rate per capita, at 6.7 filings per 1,000 residents. There is no shame in those numbers; forgiveness of debt is just about as old as debt itself.
The truth is that people from all walks of life end up seeking personal bankruptcy protection. Music fans in Tennessee may have seen headlines about singer Dionne Warwick, for example.
She recently petitioned for Chapter 7 bankruptcy, which will allow her to liquidate assets and discharge a significant amount of debt. Tax woes drove the 72-year-old singer of "Walk on By" and "I Say a Little Prayer" to seek debt relief.
According to court records, Warwick owes federal taxes dating back to 1991. The Internal Revenue Service wants her to pay almost $7 million, while the state of California says she owes $3.2 million in back taxes.
She blames her current financial problems on a previous business manager who allegedly mismanaged her money.
The singer reportedly has assets totaling $25,500. Those assets include clothing, art and jewelry. Still, her debt is said to be near $11 million.
While not everyone who needs debt relief needs it to the tune of $11 million, heavy debt is a real problem for people in Tennessee and throughout the country. But for those facing this kind of situation, it's important to remember that you are not alone. There are debt relief options that can help you breathe easier.
Source: The Wall Street Journal, "Do You Know the Way to Bankruptcy Court?" Jacqueline Palank, March 26, 2013
Source: Birmingham Business Journal, "Alabama has third highest per capita bankruptcy filing rate," Antrenise Cole, April 9, 2013