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Bankruptcy in Virginia

Are there any income requirements for filing bankruptcy in Virginia?

If you wish to file for Chapter 7 bankruptcy in the State of Virginia, you will need to meet income requirements.  These income requirements were implemented as part of a massive reform plan passed by the federal government in 2005 in order to curb the instances of abuse in the bankruptcy system.  In order to ensure that a person meets the income requirements for Chapter 7 bankruptcy a means test is used.  This means test compares the petitioners annual income for the previous calendar year to the average income in the State of Virginia for the same year.  Those individuals whose income is lower than the state average will be allowed to file for Chapter 7 bankruptcy.

If I am married, do I have to file with my spouse Virginia?

Married couples in the state of Virginia are not required to file for bankruptcy together.  However, you may have access to addition benefits if you choose to file a joint petition with your spouse.  In order to determine whether you will benefit by filing a joint petition, it is advised that you consult with a qualified bankruptcy attorney.  Since most bankruptcy attorney’s charge a single fee for joint petitions, you should not allow attorney’s fees to influence your decision to file a joint return or not.

What are the property exemption rules in Virginia?

The property exemption rules in the State of Virginia are as follows:

-Homestead exemption of up to $5,000 plus an additional $500 for each dependent

-Up to $2,000 of equity in one motor vehicle

-Up to $5,000 in a family bible; wedding and engagement rings; family portraits and heirlooms

-One burial plot and pre-paid funeral services not to exceed $5,000

-Up to $1,000 in apparel

-Up to $5,000 in home furnishings

-Up to $10,000 in tools of the trade

Will all of my debts be discharged as part of a Chapter 7 bankruptcy in Virginia?

All unsecured debts such as credit cards, medical bills, and utility bills can be discharged at the court’s discretion as part of a Chapter 7 bankruptcy in Virginia.  Any debts which are secured such as a mortgage or car loan can not be discharged as part of these proceedings.  The total amount of debt which is discharged will vary from one case to another.  Only your attorney will be able to advise you as to whether or not your specific debts are eligible for discharge as part of these proceedings.

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