Many times when newly married couples assess their finances, one partner may have brought debt into the marriage that the other was not responsible for nor the recipient of. Another situation involves where a married couple keep separate credit lines, bank accounts, and monthly budgets and then separately contribute to their common expenses. (This is a good practive for many reasons!)
So attorneys are often asked if only one spouse can file a bankruptcy. The answer is yes but with a many caveats. First, in a community property state such as Washington, real and personal property (including earnings) acquired during marriage are considered community property. So for instance if a husband bought a car in his name only during marriage the value of that car is owned as a 50/50 split between the spouses. The result is that the filing spouse must list her interest in the vehicle in the personal property section of the bankruptcy schedules.
A related point is that the income of the non-filing spouse must be included in calculating the appropriate bankruptcy chapter the filing spouse applies for. An example here is the unemployed spouse wants to file a Chapter 7 “Fresh Start” but the non-filing spouse earns money well above the state’s median income level for their family size. This may result in a Chapter 13 payment plan as whatever money remains after paying their reccuring monthly expenses is paid to the Bankruptcy Trustee for the benefit of their creditors.
As you may have guessed, there are a lot of details to go over when considering filing alone. We offer a free consultation so gives a call to set up an appointment to go over your particular situation.
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