Before filing for Chapter 13 bankruptcy, you must determine if you are legally able to do so. To qualify, you must meet specific requirements. You must have a steady source of income to be able to make the monthly payments to the trustee to distribute to your creditors.
To file Chapter 13 bankruptcy, you must be an individual or with a spouse, filing jointly. A business entity cannot file Chapter 13 and must file a Chapter 11 bankruptcy instead. If you are a sole proprietor and responsible for the debts of the business, you can include all of that depth in your Chapter 13.
Debt Too High to Qualify
If your debts are over a million dollars, your debts will be considered too high, and you will not be able to file Chapter 13 bankruptcy. You must also be current on your taxes to file Chapter 13. You can prove that you are current by providing your returns or transcripts provided by the IRS.
If you received a discharge in a previous chapter 13 case in the last two years or discharge in chapter 7 case in the previous four years, you can still file a Chapter 13, but you won’t be able to get a discharge until the required time has passed.
Current on Your Obligations
You must be current on your child support and alimony payments. If you owe back child support or alimony, you need to be able to make your current payments as well as making the back payments. If you’d don’t keep up with your payments your bankruptcy could be dismissed.
If you need help deciding if Chapter 13 bankruptcy is for you, contact a Plano bankruptcy attorney today.