Bankruptcy and Other Sources Of Income
If you are considering filing for bankruptcy, there may be some concern that your future income may be garnished or that you may be forced to file for a Chapter 13 bankruptcy even though you do not have the means to pay back any of your debt. If you are living in Paradise Valley in Maricopa County, Arizona and you are facing the possibility of filing for bankruptcy after becoming unemployed, you may be concerned as to the security of the income that you are receiving from unemployment benefits. Paradise Valley has been just as affected by the recession as other parts of the state and though this town can be considered to be one of the more affluent towns in the Phoenix metropolitan area, the unemployment figures have risen in line with those in the rest of the state.
The question of what happens when you become unemployed and decide to file for bankruptcy even though you are receiving some form of income is an important one. If you are in this position then it might be wise to consult with a local Paradise Valley bankruptcy attorney ascertain which Chapter you should be filing for bankruptcy under. The key question that will be asked in determining this will be whether or not you have the means to pay any of your debt, or to enter into a debt settlement program. Other area cities like Peoria, Glendale, and Sun City have also noticed a rise in unemployment.
The Means Test
This is a test that is administered that will take all of the sources of income that are available to you after you become unemployed and it will determine whether or not you have the ability to pay back some of your debt. If it is determined that the income you receive does allow you to pay back some of the debt as well as maintain your family, then you may be forced to file for a Chapter 13 bankruptcy. If however, it is determined that even with your income from unemployment benefits or other sources of state aid, that you will not have the means of supporting your family, then you will be eligible to file for a Chapter 7 bankruptcy, which means that you will be able to discharge all of your debt and start over with a clean slate.
There are always local nuances to every law and even though the bankruptcy code is governed at a federal level, it is always wise to consult with a local Paradise Valley bankruptcy attorney so that you can have the best local advice possible. Filing for bankruptcy is a serious decision and you want to approach it as you would any major financial decision: with the most knowledge and expert advice possible.
There are many sources of income that are exempt from the bankruptcy means test and you would be wise to consult with a Paradise Valley bankruptcy attorney to determine if your income is in fact exempt. Certain retirement annuities are exempt, as are alimony and child support payment to a certain amount. Even if you are forced to file for a Chapter 13 bankruptcy, there are certain types of income and certain amounts that are exempt from being used to repay creditors. You cannot for example be forced to use your child support payments to repay your debts.
There are so many small details that you need to be aware of when you are filing for a bankruptcy, and if you utilize the services of a Paradise valley bankruptcy attorney you will be able to capitalize on the local legal expertise that the attorneys have at their disposal.
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