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How to File for Bankruptcy in Ohio
The financial strains many are facing due to the economy are forcing more and more people to consider filing for bankruptcy. Certain states are struggling to a greater extent than others with the economy and therefore have higher bankruptcy rates per capita (per 1,000 people). In Ohio, there are roughly six filings for bankruptcy per capita. With so many people considering filing bankruptcy, new guidelines have been established to determine eligibility for filing. So how do you know if your financial situation warrants filing bankruptcy and, if so, can you protect any of your valuable assets in the process?
Finding a Bankruptcy Attorney
Consulting with an experienced attorney is essential for anyone who is considering filing bankruptcy. It is imperative that you get both financial and legal assistance before you begin the filing process and an attorney can fill both of those needs. The attorney will be able to help determine which type of bankruptcy fits your situation the best, as well as represent your case in front of the bankruptcy trustee and the judge, if required. Because the attorney will be your representative, it is vital that he/she has a good reputation and experience handling cases like yours.
Bankruptcy Options
There are a few different types of bankruptcies that must be considered before you begin filing:
- Chapter 7, known as the “liquidation” bankruptcy code, is the most commonly filed bankruptcy in the state of Ohio. It best fits those who have very few to no assets to protect and any assets that you do have will likely be sold to pay of at least some of your debts. In the end you will walk away debt-free.
- Chapter 13 is more like a modification of debts and may be the better option for those who have valuable assets. In a Chapter 13 bankruptcy, there is a plan enacted to pay off debts within three to five years.
Ohio Exemptions
Since the majority of bankruptcy filings are Chapter 7, it is important to know what protection of assets can be sought during the filing process. The state of Ohio does not allow for the use of federal exemptions, but the state exemptions that are available are fairly significant:
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Homestead |
Real or personal property used as a residence up to $20,000. |
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Personal Property |
Burial plot, motor vehicle up to $3,225; cooking unit and refrigerator up to $300 each; cash, bank, and security deposits, tax refund and money due within 90 days up to $400 total; household goods, furnishings, appliances, jewelry up to $1,350, books, animals, musical instruments, firearms, hunting and fishing equipment and crops up to $525 per item; health aids; wrongful death recoveries for person you depended upon for support; compensation for lost future earnings needed for support; personal injury recoveries up to $20,200; $400 of any property; and Tuition credit or payment. |
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Wages |
Greater of the following: 30 times the federal minimum hourly wage or minimum of 75% of disposable weekly earnings. Judge may approve more for low income debtor. |
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Pensions |
Tax exempt retirement accounts; Traditional and Roth IRAs up to $1,095,000 per person; public employees; volunteer firefighters' dependents; police officers and firefighters; public safety officers' death benefits; ERISA-qualified benefits, IRAs Roth IRAs and Keoghs needed for support; public school employees; state highway patrol employees. |
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Public Benefits |
Crime victims' compensation received within 1 year of filing for bankruptcy; vocational rehabilitation benefits; workers' compensation; unemployment compensation; public assistance; disability assistance. |
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Tools of the Trade |
Tools, books, and implements of trade up to $2,025. |
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Insurance |
Benevolent society benefits to $5,000; group life insurance policy or proceeds; fraternal benefit society benefits; disability benefits needed for support; life, endowment or annuity contract dividends, interest, loan, cash, or surrender value for your spouse, child or other dependent; life insurance proceeds for spouse; life insurance proceeds if policy prohibits use to pay creditors. |
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Miscellaneous |
Property from a business partnership. |
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Wild Card |
$1,075 of any property. |
Filing the Petition
With the type of bankruptcy decided, all exemptions considered and any financial counselling completed, the attorney can help you file a petition to the bankruptcy court. The bankruptcy trustee will then determine how the case will be handled and if an approval for the bankruptcy will be granted, allowing you to get a new financial start.