Can I file bankruptcy as an individual or must my spouse and I both file bankruptcy jointly? It is a common question our firm hears when meeting with married couples. The answer to the question is that a spouse may file bankruptcy either individually or jointly. Determining whether to file individually or jointly is based on many factors. By contacting and meeting with the experienced bankruptcy attorneys at Mooney Law, you can best determine what type of filing best fits your circumstances.
A frequent situation where filing individually would be more advantageous is when all or most debts are in the name of one of the spouses. Since little or no debts are in the name of the non-filing spouse, there is really is no point to file jointly. If you have good credit and your spouse needs to file bankruptcy primarily for his or her own debts, then it wouldn’t be in the best interest to file jointly because it will then impact the spouse with good credit. Having a spouse with no debts and good credit can certainly make it easier to purchase assets, such as a car, while in the midst of a Chapter 13 plan.
Another factor in filing individually is that assets in the name of the non-filing spouse need not be disclosed in the bankruptcy petition and filing. It is important to note though that the asset must be completely in the name of the non-filing spouse. Jointly held assets must be disclosed. So if your spouse has a significant amount of separate nonexempt property, your best option might be to file without your spouse to protect those assets.
What about debts? A debt that is co-debt or that the non-filing spouse co-signed may be discharged to the filing spouse, but will survive the bankruptcy to the non-filing spouse. The co-debts or co-signed debts would be eliminated for the filing spouse, but the non-filing spouse will remain financially responsible. Jointly held debts are significant factors to consider when determining whether a bankruptcy should be filed individually or jointly. It is important to review credit reports to determine which debts are individual and which debts are joint debts. It may very well impact the decision on whether to file individually or jointly. Filing jointly allows debts that are held by both spouses to be wiped out.
Each bankruptcy case is unique. Circumstances may very well dictate whether filing individually or jointly is the best road for you. The experienced, proven, and trusted bankruptcy attorneys at Mooney Law stand ready to assist you and answer your questions. Better yet, consultations for bankruptcy are always free at Mooney Law. To schedule a free consultation, call us today at 833-MOONEYLAW or at 717-200-HELP. You can also visit the firm website at https://www.mooney4law.com.