Business Terms

Delinquent Debt

Money that is past due by an employer for a specific quarter(s). The identification of this as delinquent debt is what triggers notification to go to the employer, and if not resolved, leads to the start of the collection process

Estimated Wages

When an employer has not responded to communication on submitting a past due wage report, SUITS determines if the Employer has a wage submission from the four quarters in the prior year. If the employer has never submitted a wage report, SUITS then SUITS will use the number of employees reported during registration and multiply it by the Taxable Wage Base

Payment Plan

An employer that has delinquent debt has set up a payment plan that consists of a frequency in which they are planning to make payment towards the debt as well as dollar amounts. These may be weekly, biweekly, monthly, etc...

Bankruptcy

Bankruptcy is a generalized term for a federal court procedure that helps consumers and businesses get rid of their debts and repay their creditors.

Bankruptcy – Chapter 7

To be eligible for Chapter 7, you cannot make enough money (minus certain expenses and monthly debt payments) to be able to fund a Chapter 13 bankruptcy repayment plan.

In a Chapter 7 bankruptcy proceeding, some of your property may be seized and sold to pay off some or all of your debts. However, as a benefit of this type of bankruptcy proceeding, any unsecured debts (debts that are not guaranteed by collateral) will be wiped out. In addition, there are certain types of property that cannot be sold in order to pay off your debts, such as the furniture in your home, your car and your clothes.

Bankruptcy – Chapter 9

Chapter 9 bankruptcy is rare and happens to provide a financially-distressed municipality (city or town that has a corporate status with local government), protection from its creditors while it develops and negotiates a plan for adjusting its debts. Reorganization of the debts of a municipality is typically accomplished either by extending debt maturities, reducing the amount of principal or interest, or refinancing the debt by obtaining a new loan.

Bankruptcy – Chapter 11

Chapter 11 bankruptcy proceedings are normally used by struggling businesses as a way to get their affairs in order and pay off their debts. In addition, some individuals also file for Chapter 11 bankruptcy when they are not eligible for Chapter 13 bankruptcy or own large amounts of non-exempt property (like several homes). However, Chapter 11 can be much more expensive and time consuming when compared to Chapter 13.

Bankruptcy – Chapter 12

Chapter 12 bankruptcy is very much like Chapter 13 bankruptcy, except that it is only available to people that have at least 80% of their debts arising from a family farm.

Bankruptcy – Chapter 13

Also known as the "wage earner" bankruptcy proceeding, only people with a reliable source of income are allowed to file for Chapter 13 bankruptcy.

In Chapter 13 bankruptcy in federal court, you must work with the court to come up with a repayment plan, and stick with the plan over the next three to five years. The amount you will need to pay is based upon your income, how much debt you owe, and how much the creditors of your unsecured loans would have received if you had filed under Chapter 7 instead of Chapter 13.

Chapter 13 bankruptcy may allow you to repay secured debts, even if you are behind on payments, without having the property that secures the debt be repossessed. You may be able to put your past due payments into your debt repayment plan, and pay them off over a period of years.

Bankruptcy – Chapter 15

Chapter 15 is a rarely seen type of bankruptcy that allows foreign debtors or other related parties to access the US Bankruptcy Courts

Pre-Petition

A company has to petition for bankruptcy protection; once this is done, liabilities fall into two categories: prepetition, or those that arise prior to petition, and post-petition, those that arise after petition.

Post-Petition

Pre-petition debt is all debt that you have incurred prior to your bankruptcy case being filed. You must list all of your Creditors and debt when you file bankruptcy. ... Post-petition debt is all debt that you incur after your bankruptcy case is filed.

Lien

A lien is a legal right granted by the owner of property, by a law or otherwise acquired by a creditor. A lien serves to guarantee an underlying obligation, such as the repayment of a loan. If the underlying obligation is not satisfied, the creditor may be able to seize the asset that is the subject of the lien.

Levy

A levy is the legal seizure of property to satisfy a debt. In order to execute a levy, there must first be a lien in place and ample notice of the levy (30 days) prior to it being carried out.

Garnishment

Wage garnishment, the most common type of garnishment, is the process of deducting money from an employee's monetary compensation (including salary), sometimes as a result of a court order. Wage garnishments continue until the entire debt is paid or arrangements are made to pay off the debt.