San Diego Bankruptcy Lawyer | Do a Husband and Wife Have to File Bankruptcy Together?

Do a Husband and a Wife Have to File Together?

A husband and wife do not have to file together, but a husband and wife should file together when they both owe some of the same debts. If one spouse files alone, creditors may try to force the other spouse into paying them, even if they are unemployed.   In addition, California is a community property states, spouses generally own equally all property earned or received during the marriage. In bankruptcy, then, all the community property of you and your spouse is owned jointly and is part of the bankruptcy estate, regardless whether you join in the filing.  On the other hand, separate property — generally property you owned before the marriage — is not affected by your spouse’s bankruptcy. Also usually an inheritance received by one spouse will be deemed their separate property.

To the extent that the community property cannot be claimed as exempt it may be sold or liquidated in a Chapter 7 bankruptcy and considered a factor in whether a Chapter 13 bankruptcy should be approved based on a “best interests of the creditors test.”  Also if one spouse files bankruptcy without the other a “spousal exemption” waiver will need to be signed by both spouses in order for the filing spouse to take advantage of the special bankruptcy  exemptions provided for under California law.   See my blog post about “spousal exemption waivers.”  The issues involved with characterizing property as either community or separate and of claiming exemptions on property is highly complex and you should always consult with skilled bankruptcy attorney before taking any action.

Finally, if you and your spouse live together in the same household, both spouses incomes will be taken into account under the means test.  Even though the non-filing spouse will not be in bankruptcy their income will be factored in for Chapter 7 qualification purposes and in order to determine disposable income and the monthly payment in a Chapter 13.