A Division 1 Proposal: The Lifeline for a Farmer and Her Assets
In the world of debt relief, a particular case unfolded recently that underscores the remarkable power of a Division I proposal. A farmer under considerable stress due to the Canada Revenue Agency (CRA) found herself amidst a taxing situation that threatened her livelihood. But, thanks to the services of the insolvency trustee at Bankruptcy Canada, she discovered a lifeline through a Division I proposal.
Under the Hammer of CRA
The farmer was not just any ordinary client. She was a self-employed individual whose personal assets, including her farm, were tied up in tax liens registered by the CRA. The scenario was so convoluted that her assets were completely tied up by CRA liens.
The farmer was feeling the heat from the CRA, which was pressuring her to liquidate her farm and assets to clear her tax debt. Undoubtedly, the idea of parting with her farm was distressing, pushing her to seek expert help.
The First Step Towards Resolving The Issue
The farmer reached out to the licensed insolvency trustees of Bankruptcy Canada for a free consultation. Here, she interacted with an insolvency trustee and discussed the various debt relief options available to her in her challenging circumstances.
Choosing the Right Solution
Among the various solutions available, the Division I proposal emerged as the best fit for the farmer’s unique situation. This is a proposal that is applicable when total debts, excluding any debts secured by the individual’s principal residence, are more than $250,000, unlike a Division II proposal or a Consumer Proposal.
Bankruptcy Canada filed a Division I proposal on behalf of the client and haggled with the CRA to settle her tax conundrum. The proposal was ultimately accepted by CRA and received the court’s approval.
A New Lease of Life
The approval of the Division I proposal brought immense relief to the client. She was now required to make payments directly to the CRA to settle the tax liens and to Bankruptcy Canada for the proposal, which they would administer and distribute among the other creditors.
This proposal meant that the client would be debt-free at the end of her Consumer Proposal. The tax liens would be removed from her assets, allowing her to retain her farm and finally put her debt issues behind her.
Expertise at Bankruptcy Canada
Bankruptcy Canada is home to Licensed Insolvency Trustees and other debt solutions professionals who possess the right experience and knowledge to prepare both Division I and Division II proposals. They are well-equipped to provide clients with the best option to resolve their debt issues, irrespective of the amount of debt they carry.
This case is a testament to how A Division 1 Proposal can protect a farmer and her assets, a story of hope for those grappling with similar complex debt situations. It underlines the importance of seeking professional advice when faced with mounting debts and the difference it can make in turning one’s life around.
