Married couples have additional considerations to think about before filing Chapter 7 or Chapter 13 bankruptcy. A major decision for married couples is whether to file jointly or separately.

Filing Bankruptcy Jointly

When filing bankruptcy jointly, both parties in the marriage file a single set of bankruptcy papers with the court. A joint bankruptcy requires that all property, debts, expenses and income for both parties must be revealed. With regard to debts, in a joint filing, all joint and individual debts are included. Like debts, all joint and individual property is also included in this type of filing.

The benefits of joint bankruptcy are that the costs are lower and the process is efficient.

It is important to remember that the non-filing spouse if filing independently, still has to be disclosed but it is not included in the bankruptcy paperwork and the non-filing spouse is not required to attend hearings regarding the bankruptcy.

Filing Bankruptcy Separately

Filing individually does not mean that the spouse is not impacted. The impact to the spouse depends on whether the couple resides in a community property or a common law property state.

In community property states, property that is acquired during the marriage is seen as owned equally by both parties, regardless of whose name is on the title. But in common law property states, if your name is on the title or if you purchased it then it’s yours. In common law property states, the individual’s separate property becomes part of the bankruptcy filing. In community property states, all community property becomes a part of the bankruptcy.

New York is considered an equitable distribution state meaning that marital property is divided in a way that is fair, but not necessarily equal.

Bankruptcy for Same-Sex Couples

As of June 26, 2013, legally married same-sex couples are able to file a joint bankruptcy petition. However, same-sex couples who are not legally married still can not file a joint bankruptcy petition. Therefore, where a same-sex couple resides dictates both their legal marital status and their ability to file a joint bankruptcy petition.

The attorneys at the Law Offices of Julio Portilla PC will make sure that you get what is fair and what you deserve, and are able to serve a diverse population, including Spanish-speaking clients.

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