What are the qualifications for bankruptcy?
In the United States, individuals and some companies trying to fulfill their financial obligations, they have the opportunity to apply for bankruptcy. The qualification of bankruptcy varies slightly depending on the type of bankruptcy required. Primary qualification factors include availability and income, debt amount and debt type. In some cases, there are also instructions on ownership of stay and real estate. Other countries with bankruptcies will have different specific qualifications, but in many cases the factors that are considered will be similar.
The most common types of bankruptcy administration available to individuals are Chapter 7 and Chapter 13. Chapter 13 The submissions are only available to individuals and not corporations or partnerships. When filing this plan, there are restrictions on the amount of debt. Since 2011, the limits of $ 360,475 have been USD (USD) of unsecured debt and $ 1,081,400 in S. Essed debt.
Another qualifying factor for bankruptcy in Chapter 13 is enoughthe strength of income. The applicant must obtain regular income and the amount of this income must be sufficiently sufficient for normal household expenses. Other qualifications for bankruptcies pursuant to Chapter 13 include the applicant who is obliged to receive credit consultancy through the credit consultancy center approved by the courts.
Qualifications for bankruptcy under bankruptcy laws in Chapter 7 do not limit the capacity to the individual. Corporations and partnerships are also eligible for submitting pursuant to Chapter 7, but only individuals can qualify for the debt to be fulfilled as planned. The operation will release Filler from liability for debt included in the submission. As in Chapter 13, the applicant must accept and participate in credit consultancy under the program.
Chapter 7, there are no limitation of the amount of debt that can be included in bankruptcy. Revenue requirements also foxfrom Chapter 13. There is no condition of income under chapter 7. In fact, if the applicant has income, there is a limitation of the amount that may be. The bankruptcy courts use a somewhat complex formula known as a test of means to determine the qualification of income.
The first part of the test compares the average monthly income of a candidate with an average income for the state in which the proposal for bankruptcy is filed. In general, the intake level should be less than the median. In cases where the applicant's income exceeds medium income, a second test is used. The second part of the test formula measures a one -off income of the petitioner to determine whether it is under a certain threshold. Finally, one -time income is compared with the amount of unsecured debts and the determination of eligibility.
In considering the qualification of income for bankruptcy in Chapter 7, the income received by the applicant's wife is usually included. There is an exception when a couple filed a separate tax return and maintains a separate intowe. Revenue obtained through social security benefits are also excluded.