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Does my spouse have to file too?

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Do both spouses have to file for bankruptcy?

Individual versus Joint

Do you have any joint debts?  Are all of the credit cards and personal loans in your name only?  I recommend you take a look at your credit reports if you are in doubt.  (annualcreditreport.com is free for you to see each of your 3 major credit reports every 12 months.)  Any site that asks for a credit card or insists on a subscription should be a red flag.  These reports do not include credit scores.  Look at each debt for an "I" individual, "A" authorized user,  or "J" joint.  Authorized users do not have liability on that debt.  If you have a credit card that will be discharged in bankruptcy then your liability will be removed, but not so for the other person joint on that account (e.g. cosigners or guarantors).

 

Medical Bills

What about medical bills?  If you are married or separated, then in North Carolina, the hospital has a strong argument that your spouse's medical bills are yours too.  It is part of the Doctrine of Necessaries and it is the assumption you would pay their bill.  So, if you were taken by an ambulance to the emergency room, then the hospital may pursue your spouse for payment if you do not pay.  In my experience in the past, they try to get you to sign something making you liable if you are there.  Even if you are there for a family member or a friend look at each signature page because it may be in with the other forms.  I know you have a lot on your mind, but read what is given to you.  Don’t just take their word for it that it is, “standard.”

 

Income Taxes

Did you and your spouse file a joint return this year or any year in the past that you may still owe the IRS or the State?  If you discharge that tax debt (the tax is from regular income tax, over 3 years old, you filed over 2 years ago and numerous other factors to discuss with your attorney) then your spouse may still owe it.  There is some good news here too.  If you pay the debt through the Ch13 plan then you can take care of the debt without your spouse filing.

 

Mortgage

Same as the taxes in that one spouse can take care of the obligation for the other without them filing.  Example:  Husband and Wife are on the mortgage.  Husband has 20k in credit card debt in his name only and the house is 3 months behind with a threat of foreclosure.  He could file a chapter 13 to get rid of the credit card debt and at the same time catch up the arrears on the house to make it current and avoid foreclosure.  Wife would not have to be involved.

 

Minimum information

Often spouses keep their finances separate.  This is very common when it isn’t the first marriage for one or both.  Sometimes the other spouse "doesn't want to be involved in the bankruptcy."  Good news, it isn’t a requirement to file a petition also.  Only some basic information is needed from the non-filing spouse, like how much money is contributed to the filer each month.  Does the non-filer pay for both cars?  But it really comes down to this:  if you dislike your spouse struggling with debt problems then be proactive, be supportive, help them get back on their feet.   For better, for worse.

 

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