Married Couples
If you are married, you can file bankruptcy by yourself, without your husband or wife. A married couple does not need to file together, but may file together if they chose to do so. If you are married and want to file bankruptcy separately without your spouse, an experienced San Diego bankruptcy lawyer can help you file bankruptcy without affecting your spouse, at all. The bankruptcy laws offer important protections to your spouse when you are married filing bankruptcy alone without your spouse.
Married Filing Bankruptcy in San Diego
In many cases, you can file bankruptcy in San Diego without your spouse and your bankruptcy will protect both you and your spouse even though only one of you files and is not part of any court proceeding! This is by virtue of both the bankruptcy stay and the discharge injunction, both of which protect your spouse. For some married couples, filing alone without your spouse may be your best course of action. But if your non-filing spouse has a large amount of debt, it is usually advisable for both of you to file so that you can both begin rebuilding credit. An experienced San Diego bankruptcy attorney can help you decide whether it is in you and your spouse's best interests that you to file bankruptcy alone, or whether you and your husband or wife should file together jointly. This decision can only be made after a bankruptcy attorney has reviewed your entire case in detail.
Do I Include Spouse's Property?
In California, if you are married and filing alone, you have to disclose to the bankruptcy court all of your separate property and all of your community property, but not your non-filing spouse’s separate property (for example, inheritance). As long as your separate property and your community property that you own with your husband or wife is covered by your bankruptcy exemptions, you will keep the property. The separate property of your husband or wife is not even listed in your bankruptcy filing.
Do I list my spouse’s income?
Even if your spouse is not going to be a part of your bankruptcy proceeding, you still have to disclose your household income, which includes the income of both you and your spouse. This does not mean that your spouse is part of the bankruptcy proceeding, or that your bankruptcy filing will affect your non-filing husband or wife in any way. Your non-filing spouse's income is used only to determine whether your household income qualifies you to pass the Means Test and file for bankruptcy relief. If your husband or wife is a very high income earner, you may not qualify to file, as the bankruptcy laws would expect your husband or wife to help you repay your debts. Calculation of your spouse’s income is only used for purposes of determining if, based on your total household income and expenses, you have the ability to repay some or all of your debts instead of filing bankruptcy on your debts.
Will My Spouse Be Protected By My filing?
Under the bankruptcy laws, when one spouse obtains a discharge of his or her debts, that discharge enjoins (stops) existing creditors from collecting on a community claim (a debt existing before filing bankruptcy that a married couple's community property is liable for) against any of the two spouses' exempt community property or any community property. That means that, in most cases, your discharge will protect your non-filing spouse.
Married Filing Chapter 7
In a Chapter 7 case, you typically receive a discharge of your debts about 90 days after your bankruptcy filing. Once you get a discharge, the discharge injunction takes effect. The discharge injunction protects both your separate property and community property as to claims community property was liable for, but will not protect your non-filing spouse’s separate property. California law will govern whether your spouse’s separate property is liable. In California, the separate property of a married couple is generally is not liable for a debt incurred (before or during marriage) by the other spouse unless it was for "necessaries of life" (food, shelter, clothing, and the like.) Because you get a discharge typically in 90 days, your non-filing spouse is often adequately protected by your Chapter 7 bankruptcy.
Married Filing Chapter 13
In a Chapter 13 case, you don’t get a discharge until you complete your Chapter 13 repayment plan, typically 36 to 60 months after you file bankruptcy. Depending upon your unique needs and circumstances, your attorney may recommend that your spouse join in your bankruptcy filing.
Chapter 13 Co-Debtor Stay
Chapter 13 is a repayment bankruptcy. You will not receive a discharge of your debts for 3-5 years, after you have completed your bankruptcy repayment plan. Pending receipt of your discharge, there is a Chapter 13 “codebtor stay” that protects both married couples during your Chapter 13, from the date of filing through discharge, but the codebtor stay applies only to a consumer debt (not business debt) and only if you are a co-borrower with your non-filing spouse. If you are not a co-borrower, that is, if the debt is in your non-filing spouse’s name alone, then there is no codebtor stay and your non-filing spouse’s creditors can continue collection proceedings until the time that you complete your repayment plan and obtain a discharge.
