Filing Jointly for a Chapter 13 Minneapolis Bankruptcy

Marriage can have certain legal benefits, some of which you may not know. In addition to tax breaks and inheritance rights, married couples can also take advantage of certain rights in bankruptcy proceedings. They have two options: filing separately or filing together. By filing jointly for a Chapter 13 Minneapolis bankruptcy, you may be able to clear two debts at once, saving costs, time, and effort.

While that may seem like an obvious choice, it may not necessarily be the right one for your situation. Speaking with an experienced Chapter 13 bankruptcy attorney at Walker & Walker can help you determine the right path for you and your family.

Marriage and Chapter 13 Bankruptcies

Chapter 13 bankruptcy allows you to repay a portion of your debts through a court-approved repayment plan over three to five years.  While the debts receive some money throughout the duration of the plan, any remaining eligible debts are discharged once the plan is successfully completed.

To be eligible for a Chapter 13 filing, debtors must meet certain criteria, such as the amount of debt owed and having a regular income sufficient to repay creditors. Courts assess this through a means test, which also determines the length of the repayment plan and the amount of each payment.

For an individual, eligibility and means tests are relatively straightforward. However, the calculation becomes more complicated for a married couple filing together for a Chapter 13 bankruptcy in Minneapolis.

For assessing the amount owed, debts fall into one of two classifications—separate or joint. Separate debts are those each spouse acquired on their own, usually before the marriage. Joint debts have both spouses’ names attached to them, such as joint taxes. If the couple’s combined debts exceed the maximum thresholds in the means test, Chapter 13 may not be appropriate.

If the combined income of both spouses falls below the means-testing threshold, that could result in a shorter repayment plan. This may help you and your spouse reduce your debt faster than if you filed for bankruptcy separately.

What Are Some Advantages of Filing Together?

Pursuing Chapter 13 bankruptcy together allows both spouses to share the same attorney, court dates, and fees, making the process cost-effective. Combining everything into a single filing can also be an efficient way to eliminate a significant portion of each spouse’s overall debt.

Additionally, filing jointly may allow both spouses to keep more of their property after bankruptcy. Each spouse may exclude certain property from the process, and, by filing together, the couple can combine these exclusions to keep more property.

Before going forward with a joint Chapter 13 filing, it is important to review your situation with one of our knowledgeable Minneapolis bankruptcy lawyers. This can help you and your spouse prepare for the process.

Consult an Attorney About Filing for a Chapter 13 Bankruptcy With Your Spouse in Minneapolis

Filing jointly for a Chapter 13 Minneapolis bankruptcy offers several benefits. Importantly, it can give your family a fresh start. The lawyers at Walker & Walker can help you determine if this is the right option for you.

Our team is here to support and guide you through every step of the process. Contact us today and schedule a consultation with one of our compassionate bankruptcy attorneys.