Can I File Bankruptcy if I am Married?

Bankruptcy for a married couple adds some additional complexity to the process. While an individual filing bankruptcy need only worry about creditor claims against themselves, a married bankruptcy petitioner must ensure that his or her spouse is also protected from credit claims for which debt has been accrued jointly.

Options for Married Couples

Married couples have two options for filing bankruptcy; They can file jointly or one spouse can file as an individual. While one spouse may wish to file as an individual to protect the others credit score, there are consequences that may leave the other non-filing spouse liable for debts that would otherwise be discharged in a joint bankruptcy petition.

Joint Bankruptcy Filing

If a couple files bankruptcy jointly, then their case is essentially treated as an individual bankruptcy and creditors claims against one, the other or both spouses are treated mush as they would be against a single petitioner.

The main benefit of filing a joint bankruptcy petition is that both spouses are covered by the bankruptcy discharge, and creditors cannot attempt to collect these debts.

Filing an Individual Bankruptcy Petition

If one spouse files for bankruptcy, then the other spouse is unaffected by the case. The problem is, the non-filing spouse is also left unprotected from creditor claims for debts for which both spouses are liable.

For example, if the couple has a credit card account with both names on it, the petitioning spouse will have that debt discharged and will no longer be liable for repayment, but the credit card company or bank still has a legal claim for the debt against the non-filing spouse.

Planning Ahead for Individual Bankruptcy

It may be possible to organize creditor claims such that only the petitioning spouse is liable for the debt, and in that way the debt may be discharged and the creditor will not have another account holder from which to seek payment.

Talk to a Bankruptcy Lawyer

In these cases, it is critical to have legal representation to ensure both spouses are protected by the bankruptcy petition as well as avoid any legal repercussions from pre-bankruptcy debt liability structuring that may be seen by the court as bankruptcy fraud.