File chapter 7 bankruptcy

You can receive tax refunds while in bankruptcy. However, refunds may be subject to delay, to turnover requests by the Chapter 7 Trustee, or used to pay down your tax debts. The unit is available Monday through Friday from a.

At the conclusion of your Chapter 7 bankruptcy you will receive a discharge of debt. A discharge releases you the debtor from personal liability for certain dischargeable debts. Some taxes may be dischargeable. Whether a federal tax debt may be discharged depends on the unique facts and circumstances of each case. Consult your bankruptcy attorney to determine which tax debts may be discharged. Please note: We cannot provide legal or other advice about your bankruptcy case.

The bankruptcy clerk gives notice of the bankruptcy case to all creditors whose names and addresses are provided by the debtor. Between 21 and 40 days after the petition is filed, the case trustee described below will hold a meeting of creditors.

If the U. During this meeting, the trustee puts the debtor under oath, and both the trustee and creditors may ask questions. The debtor must attend the meeting and answer questions regarding the debtor's financial affairs and property. If a husband and wife have filed a joint petition, they both must attend the creditors' meeting and answer questions.

Within 10 days of the creditors' meeting, the U. It is important for the debtor to cooperate with the trustee and to provide any financial records or documents that the trustee requests. The Bankruptcy Code requires the trustee to ask the debtor questions at the meeting of creditors to ensure that the debtor is aware of the potential consequences of seeking a discharge in bankruptcy such as the effect on credit history, the ability to file a petition under a different chapter, the effect of receiving a discharge, and the effect of reaffirming a debt.

Some trustees provide written information on these topics at or before the meeting to ensure that the debtor is aware of this information.

In order to preserve their independent judgment, bankruptcy judges are prohibited from attending the meeting of creditors. In order to accord the debtor complete relief, the Bankruptcy Code allows the debtor to convert a chapter 7 case to a case under chapter 11, 12, or 13 6 as long as the debtor is eligible to be a debtor under the new chapter.

However, a condition of the debtor's voluntary conversion is that the case has not previously been converted to chapter 7 from another chapter. Thus, the debtor will not be permitted to convert the case repeatedly from one chapter to another. When a chapter 7 petition is filed, the U. If all the debtor's assets are exempt or subject to valid liens, the trustee will normally file a "no asset" report with the court, and there will be no distribution to unsecured creditors.

Most chapter 7 cases involving individual debtors are no asset cases. But if the case appears to be an "asset" case at the outset, unsecured creditors 7 must file their claims with the court within 90 days after the first date set for the meeting of creditors. A governmental unit, however, has days from the date the case is filed to file a claim. In the typical no asset chapter 7 case, there is no need for creditors to file proofs of claim because there will be no distribution. If the trustee later recovers assets for distribution to unsecured creditors, the Bankruptcy Court will provide notice to creditors and will allow additional time to file proofs of claim.

Although a secured creditor does not need to file a proof of claim in a chapter 7 case to preserve its security interest or lien, there may be other reasons to file a claim. A creditor in a chapter 7 case who has a lien on the debtor's property should consult an attorney for advice. Commencement of a bankruptcy case creates an "estate. It consists of all legal or equitable interests of the debtor in property as of the commencement of the case, including property owned or held by another person if the debtor has an interest in the property.

Generally speaking, the debtor's creditors are paid from nonexempt property of the estate. The primary role of a chapter 7 trustee in an asset case is to liquidate the debtor's nonexempt assets in a manner that maximizes the return to the debtor's unsecured creditors. The trustee accomplishes this by selling the debtor's property if it is free and clear of liens as long as the property is not exempt or if it is worth more than any security interest or lien attached to the property and any exemption that the debtor holds in the property.

The trustee may also attempt to recover money or property under the trustee's "avoiding powers. In addition, if the debtor is a business, the bankruptcy court may authorize the trustee to operate the business for a limited period of time, if such operation will benefit creditors and enhance the liquidation of the estate. Section of the Bankruptcy Code governs the distribution of the property of the estate. The debtor is only paid if all other classes of claims have been paid in full.

Accordingly, the debtor is not particularly interested in the trustee's disposition of the estate assets, except with respect to the payment of those debts which for some reason are not dischargeable in the bankruptcy case. The individual debtor's primary concerns in a chapter 7 case are to retain exempt property and to receive a discharge that covers as many debts as possible.

A discharge releases individual debtors from personal liability for most debts and prevents the creditors owed those debts from taking any collection actions against the debtor. Because a chapter 7 discharge is subject to many exceptions, debtors should consult competent legal counsel before filing to discuss the scope of the discharge.

Generally, excluding cases that are dismissed or converted, individual debtors receive a discharge in more than 99 percent of chapter 7 cases. In most cases, unless a party in interest files a complaint objecting to the discharge or a motion to extend the time to object, the bankruptcy court will issue a discharge order relatively early in the case — generally, 60 to 90 days after the date first set for the meeting of creditors. The grounds for denying an individual debtor a discharge in a chapter 7 case are narrow and are construed against the moving party.

Among other reasons, the court may deny the debtor a discharge if it finds that the debtor: failed to keep or produce adequate books or financial records; failed to explain satisfactorily any loss of assets; committed a bankruptcy crime such as perjury; failed to obey a lawful order of the bankruptcy court; fraudulently transferred, concealed, or destroyed property that would have become property of the estate; or failed to complete an approved instructional course concerning financial management.

Secured creditors may retain some rights to seize property securing an underlying debt even after a discharge is granted. Depending on individual circumstances, if a debtor wishes to keep certain secured property such as an automobile , he or she may decide to "reaffirm" the debt.

A reaffirmation is an agreement between the debtor and the creditor that the debtor will remain liable and will pay all or a portion of the money owed, even though the debt would otherwise be discharged in the bankruptcy. In return, the creditor promises that it will not repossess or take back the automobile or other property so long as the debtor continues to pay the debt. If the debtor decides to reaffirm a debt, he or she must do so before the discharge is entered.

Keep it. Bankruptcy laws require that you provide a copy of this certificate to the court when you file your bankruptcy forms in Step 5. The bankruptcy forms include at least 23 separate forms , totaling roughly 70 pages. The bankruptcy forms ask you about everything you make, spend, own, and owe.

If you hire a lawyer , they will complete the forms for you based on the information you submit to their office. If you can't afford to hire a lawyer but don't feel comfortable completing the forms on your own, see if you're eligible to use Upsolve's free online bankruptcy service or schedule an appointment with a legal aid provider in your area. This amount is typically due when the bankruptcy petition is filed with the court.

You can ask to make up to 4 monthly payments. The court will decide whether bankruptcy laws support granting you a waiver. This happens after your bankruptcy petition. If your application is denied, the court will typically order you to pay the fee in installments. Once you have prepared your bankruptcy forms, you will need to print them out for the court.

You must print them single-sided. You will also need to sign the forms once they are printed. Most bankruptcy courts require just one signed original of the petition , but some courts require additional copies. So, before you head out to submit your forms, call your local bankruptcy court to find out how many copies you will need to bring and confirm you have all the required local forms. Once you enter the doors of your local courthouse , you will be greeted by security guards, who will ask you to pass through a metal detector.

They will take your bankruptcy forms and your filing fee or application for a waiver or to pay the fee in installments. Do not submit your bank statements or tax returns to the court. These documents go to the trustee after the case is filed.

Check out Step 7 below for more info on that. This usually takes no more than 15 minutes. The name of your bankruptcy trustee. At this point, your case has been filed! The automatic stay now protects you from all debt collectors.

The Chapter 7 trustee is an official appointed by the court to oversee your case and liquidate, or sell, nonexempt property for the benefit of your creditors. Not all types of bankruptcy require the involvement of a bankruptcy trustee, but both Chapter 7 and Chapter 13 cases have one.

Pay attention to mail you receive from the trustee after filing your case. The trustee will send you a letter asking you to mail them certain financial documents, like tax returns, pay stubs, and bank statements. After filing your bankruptcy forms, you will need to complete a Debtor Education Course from an approved credit counseling agency.

The purpose of the course is to educate you on making smart financial decisions going forward but does not provide legal advice about the bankruptcy process.

Your meeting, or meeting of creditors , will take place about a month after your bankruptcy case is filed. Due to the COVID pandemic, all meetings are held either by video conference or via telephone until at least October. The main purpose of the meeting is for the case trustee to verify your identity and ask you certain standard questions and most last only about 5 minutes.

Your creditors are allowed to attend and ask you questions about your financial situation, but they almost never do. You should also bring a copy of your bankruptcy forms to the meeting, along with your last 60 days of pay stubs, your recent bank statements, and any other documents that your trustee has asked for. The bank will either file request with the bankruptcy court to ask permission to retake the car, or wait until your discharge is granted before picking it up.

If you want to keep the car, you can either reaffirm the loan or redeem the car. You have to complete and sign the agreement and return it to the bank within 45 days from your meeting. The bank files the signed agreement with the court for approval.