The summary & checklist below is provided as a courtesy
by our office to help you gather
documents for your bankruptcy case

There is a misconception among the public that they can no longer file a chapter 7 bankruptcy. Although the recent bankruptcy reform law which went into effect on October 17, 2005, greatly changed existing bankruptcy laws, it did not repeal the bankruptcy protection system in the United States. A summary of the new law and its requirements are set forth below:

1. You must also attend a Pre-Bankruptcy Debt Counseling and file proof of completion before your case is filed. You must also attend a Financial Management course after your case is filed and provide the court with proof of completion before your debts can be discharged. You enroll in both courses at www.startfreshtoday.com. You can also find a list of approved providers here.

2. You must gather all your current credit card bills, collection letters, lawsuits, credit reports, utility bills, home mortgage statements, car payment bill, and any other documents that show a debt owed to you to any other person. Your attorney will need these documents in order to prepare your bankruptcy papers.

3. Get a free copy of your three-bureau credit report from annualcreditreport.com. You can also call 1-877-322-8228 and request a free copy of your credit report by phone. You will have to provide your social security number, address, date of birth and zip code in order to obtain your free credit report by mail.

3. Get copies of your check stubs for the past 6 months from your employer(s). You must have each and every check stub for the previous 6 month before the date of filing of your case without any gaps in the dates. In order to do the calculations to determine if you qualify under the new bankruptcy law, you will have to provide full 6 months of check stubs.

4. A copy of your most recent federal tax return or tax transcript. You can obtain a tax transcript from the IRS by faxing them the required form IRS 4506t. Directions to get your transcript are provided in the checklist below. If you don't have a tax return for the most recent tax period, a declaration signed by you attesting to that fact should satisfy the court of the requirement to provide a recent tax return.

5. Pass the "Means test". This is the most complicated part of your case. You can read the following, which may be too technical at this time to understand. This test will determine if you qualify for a chapter 7 bankruptcy. If you have more income than the test will allow or if you are deemed to be abusing the bankruptcy system, then your case will be dismissed unless you agree to pay a portion of your debts under a chapter 13 plan. You can use our free means test calculator page to see if you qualify for a chapter 7 bankruptcy. There are two tests that are applied to your income to see if you qualify under this test:

Median Income Test: Under this test, if your Current Monthly Income is below the the median income in your state, then there is no presumption of abuse and you qualify for a chapter 7 bankruptcy. If your income is more than the state median income, you must go to the second part of the test. The median income information for your State is provided by the IRS. Below is the median income for California:

CMI


* add $6300 for each person in excess of 4

If your current monthly income is greater than your State's median income level for your family size, the second part of the test looks to see if your income reduced by the IRS allowed monthly expenses for a certain family size exceeds a certain amount. The IRS allowable expenses can be found here.

So, if your current monthly income is more than the State Median Income, but your current monthly excess income is less than the amount allowed under the Mean's Test, you qualify for a chapter 7. If your current monthly income is more than your State Median Income and your excess income is greater than the amount allowed under the Mean's Test, your case will be presumed abusive and dismissed unless there are special circumstances in your case or unless you agree to repay a portion of your debt under a chapter 13 plan.

Once your case is electronically filed with the Court, you will receive official notification of your meeting of creditors date. The meeting of creditors is usually 30 to 40 days after the initial filing of the bankruptcy petition.

The meeting of creditors is called that because creditors have the chance to attend the meeting and ask you questions regarding their debt. You have an obligation at that point to answer their questions under oath. Creditors rarely show up at the meeting of creditors and as a result you will only be questioned by the bankruptcy trustee for a few minutes and then dismissed.

The bankruptcy trustee is appointed by the Court to oversee your case. Her job is to find non-exempt assets which you may own, sell them, and pay your creditors a certain percentage of their debt from the proceeds of the sale. If she determines that you have no non-exempt assets, she will send a report to the court stating that you have no assets to liquidate. The court will then grant you a discharge and close your case.