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Now we have a new reason to be concerned about parents helping their adult children when the parents have to file bankruptcy later. In a recent case in Connecticut, a bankruptcy trustee sued a college to get back about $21,000.00 the college had been paid by the parents of a student.

If you have been sued and have a judgment against you, it is likely that from time to time the judgment holder will try to garnish your wages. The way it works is as follows:

At least once a year the creditor, or their attorney, is required to send you a form by which you can tell the judgment holder that your wages cannot be garnished.

Back in 2005 Congress inserted a "means test" into the bankruptcy code.  
What this means is that when you file bankruptcy, we must add up your income from all sources (except Social Security payments and, arguably, unemployment compensation benefits) for the six months before the month in which your case is filed.  

A Minnesota attorney named Paul Hansmeier was "sort of famous" for being involved in a set of cases often called the Prenda Law cases. The gist of those cases was that the Prenda Law Firm would threaten to sue person "X" for downloading copyrighted pornography, but would settle the case for a few thousand dollars.