One of the most common questions we hear as Chapter 7 bankruptcy lawyers is whether a person can file bankruptcy without their spouse. The simple answer is “yes”, but there are certain considerations.
First, our goal at Mile High Bankruptcy is to fix the financial problems of the entire family. If your debts are joint debts, the Chapter 7 will eliminate your debts, but the creditors can and will go after your spouse. This is usually not a good outcome, and it may be better to file together.
Another consideration is your spouse’s income. If you are married and not separated, your spouse’s income must be included in the median income test to see if you even qualify to file chapter 7. For example, if you make $36,000 a year and were filing as an individual, you are under the median income for your household size in Colorado and would qualify to file.
But, if you are married without children, and your spouse makes $100,000 a year, you must add this to your income for a household of two, and you would probably not qualify for chapter 7 and could only file a five year chapter 13 plan, despite your modest individual income, and despite the fact that your spouse doesn’t file.
Other considerations are property issues. You or your wife may have assets that are wholly theirs that may not be exempt. For example, if your spouse inherited a fully paid for house worth $300,000, they would lose the house in bankruptcy because it is way in excess of the allowed protected homestead exemption.
In conclusion, many people want to file alone because the debts involved are only theirs and not their spouse’s responsibility. This is often fine, but all of the above issues must be reviewed with experienced bankruptcy counsel before making a decision.
If this is a concern, give me, Peter Milwid, a call ((303) 831-0733), and I can walk you through your options.