Who Can File Chapter 13 Bankruptcy

As part of the bankruptcy process, Chapter 13 bankruptcy requires you to use your income to repay some or all of your debts and you will need to prove to the bankruptcy court that you can afford to meet all of your payment obligations. This is generally determined by the bankruptcy court based on information you provide when filing your case.

Similar to a Chapter 7 bankruptcy, you must complete the “means test” to determine if your income is higher than the median income for your state. If you income is lower than the median income for your household size, you will be eligible to complete your Chapter 13 repayment in 3 years. If your income is higher than the median income for your state, you will need to commit to a 5 year repayment plan and may need to guarantee a certain amount of money to your unsecured creditors.

You must be current on your income tax filings. While you only need to provide the most recent year to the trustee, you will be asked under oath if you have filed the tax returns that you are required to file for the previous 4 years and if you have not filed them, your case can be dismissed. Generally, the court will give you several months to file your taxes after your case is filed but if you do not have them filed at that time, your case will be dismissed.

While you do not have to wait to file a Chapter 13, you may not be able to receive a discharge if you received a Chapter 7 discharge within the previous 4 years or a Chapter 13 discharge within the previous 2 years. Even though you may not recseive a discharge, you can still receive the protections of filing bankruptcy.

To learn if you or a loved one can file a Chapter 13 bankruptcy, contact attorney Jason Fauss online or call (314) 291-8899 to schedule a FREE consultation to discuss your specific situation.