A chapter 7 bankruptcy case does not involve the filing of a plan of repayment as in chapter 13. Instead, the bankruptcy trustee gathers and sells the debtor's nonexempt assets and uses the proceeds of such assets to pay holders of claims (creditors) in accordance with the provisions of the Bankruptcy Code.
If your annual income, as calculated on line 12b, is less than $84,952, you may qualify to file Chapter 7 bankruptcy. If it's greater than $84,952, you'll have to continue to Form 122A-2, which we'll review in the next section. It should be noted that every state has different median income calculations.
Here are some things to avoid before you file for Chapter 7 or Chapter 13 bankruptcy.
You can keep 75% of cash attributable to your wages, and up to $1,000 per person filing ($2,000 for husband and wife filing together) in addition to the 75%, unless you have used this exemption for something else.
The rejection or denial of a Chapter 7 bankruptcy case is very unusual, but there are reasons why a Chapter 7 case can be denied. Many denials are due to a lack of attention to detail on the part of the attorney, errors made on petitions or fraud itself.
If you file for Chapter 7 bankruptcy and local bankruptcy laws allow you to exempt all of the equity you have in your car, you can keep the vehicle—as long as you're current on your loan payments. ... If you have less equity than the exemption limit, the car is protected.
In most Chapter 7 bankruptcy cases, nothing happens to the filer's bank account. As long as the money in your account is protected by an exemption, your bankruptcy filing won't affect it.
Typically, you can cancel executory contracts in bankruptcy, including your cell phone plan. You should carefully consider whether you want to continue or if you want to back out of it now. A trustee will not sell any property that is exempted.
Debt collectors cannot try to collect on debts that were discharged in bankruptcy. Also, if you file for bankruptcy, debt collectors are not allowed to continue collection activities while the bankruptcy case is pending in court.
Chapter 7 bankruptcy wipes out most types of unsecured debt. Unsecured debts are debts that aren't guaranteed by collateral property. ... Unsecured debts wiped out by Chapter 7 bankruptcy include credit card debt, medical bills, and gasoline card debt. However, you can't wipe out all unsecured debt.
A tax refund is an asset in both Chapter 7 and Chapter 13 bankruptcy. It doesn't matter whether you've already received the return or expect to receive it later in the year. ... As with all assets, when you file for bankruptcy, you can keep your return if you can protect it with a bankruptcy exemption.
Can I Take a Vacation While in Chapter 7? If you want to take a vacation while in Chapter 7, this is permissible as long as it is in your budget. Keep in mind however there is always the chance the Trustee and/or your attorney will request additional information or documentation while you are away.
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