Should You File for Bankruptcy Jointly with Your Spouse?
If you and your spouse are suffering financial distress and are considering filing for bankruptcy in Florida, you may be wondering whether you should file as an individual or jointly. In most cases it benefits couples to file jointly, although in certain situations that is not the case. Regardless of how you file, remember that certain debt such as most taxes, alimony and child support, and others cannot be discharged. To decide what’s best for you, discuss your situation with an experienced bankruptcy attorney. Here are a few general guidelines:
Plusses for Filing Jointly
Most couples facing bankruptcy file jointly. There are some key reasons that it might behoove you, too, to file jointly:
- You can save time and money by filing jointly since there will be a single proceeding in which an attorney can represent you both. Filing separately would require you both to fork out required filing fees and could also double your attorney’s fees. Putting the whole thing behind you would likely take longer, as well, since closing out two cases will require more time than resolving a single case.
- All debt will be disposed of in one action. It won’t matter if debt is individual or joint—it will all be addressed in the same action.
- Whether you file individually or jointly, both spouses’ incomes will be considered.
- Since, for most couples, the majority of assets are community property, you will be able to shield more of your assets from creditors. (The opposite is true if one partner owns the majority of property individually.)
Minuses for Filing Jointly
Filing individually may be advantageous under certain circumstances:.
- When filing for bankruptcy, whoever is named in the bankruptcy petition will experience a serious ding to their credit rating. Filing individually will salvage one partner’s financial standing.
- If you file for bankruptcy individually, any shared debt will be included in the discharge, but your spouse will still be liable for the shared debt. If that spouse also has a large amount of separate property, creditors will be able to go after it in an attempt to be made whole. If you file individually, the non-filing spouse will not have to worry about their personal property being liquidated.
- If you’re thinking about divorcing soon, a joint bankruptcy filing could complicate matters down the road.
Advocating for You
Anyone considering bankruptcy may have many questions about the right chapter to file, whether to file jointly, and what to expect. At the Law Office of Julia Kefalinos our experienced Miami bankruptcy attorneys are here to help. To discuss your situation, schedule a confidential consultation in our Miami office today.
Source:
flsb.uscourts.gov/understanding-bankruptcy
