Eligibility for Jacksonville Florida Chapter 7 Bankruptcy

Chapter 7 Eligibility

Individuals, partnerships, and all other business forms are eligible to file a Chapter 7 bankruptcy. Individuals’ eligibility to file is determined by the mean’s test. The code does bar individuals under certain procedural grounds, such as:

1. An individual cannot file under chapter 7 or any other chapter, however, if during the preceding 180 days a prior bankruptcy petition was dismissed due to the debtor's willful failure to appear before the court or comply with orders of the court, or the debtor voluntarily dismissed the previous case after creditors sought relief from the bankruptcy court to recover property upon which they hold liens. 11 U.S.C. §§ 109(g), 362(d) and (e).

2. No individual may be a debtor under chapter 7 or any chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an approved credit counseling agency either in an individual or group briefing. 11 U.S.C. §§ 109, 111. There are exceptions in emergency situations or where the U.S. trustee (or bankruptcy administrator) has determined that there are insufficient approved agencies to provide the required counseling. If a debt management plan is developed during required credit counseling, it must be filed with the court.

The goal of Chapter 7 bankruptcy, according to official government publications, is “to discharge certain debts to give an honest individual debtor a ‘fresh start.’ The debtor has no liability for discharged debts.”

There are important limitations on the types of debts that can be discharged. However, under limited circumstances, some debt which normally is not dischargeable, such as student loans and taxes may be discharged. Discharge of debts is not available to a corporation and does not extinguish liens on properties. However, debtors oftentimes can discharge thousands of dollars, and in some cases, even hundreds of thousands of dollars worth of debt. Those who are not eligible for a Chapter 7 may still be eligible for relief under Chapter 13.

Please see other pages that we have on Chapter 7 bankruptcies, including:

1. What relief is offered by a Chapter 7?
2. How does a Chapter 7 case proceed?
3. What property is exempt from Chapter 7 liquidation?
4. Who is the Chapter 7 Trustee and what do they do?
5. How does a Chapter 7 discharge debts?

Please contact us to make an appointment to discuss your bankruptcy questions.

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