Knoxville, TN Bankruptcy Attorney – Filing with No Income
January 21, 2021at5:00 AM
Bankruptcy is a helpful legal process that can get you out from under unmanageable debt and get your finances back on track for the future. However, contrary to conventional logic, filing for bankruptcy is not an inexpensive process. Between the filing fees, financial management courses, and paying for an attorney, the costs to declare bankruptcy quickly add up. This leaves many people who have no income confused about how they can go about having their debt relieved. The team of Knoxville, TN bankruptcy attorneys here at DZ Law understand how frustrating that can be, which is why we’re happy to offer these helpful tips.
How to File for Bankruptcy with No Income
See if you qualify for a filing fee waiver.
If you plan on filing for bankruptcy under Chapter 7, then one of the first costs you’ll have to pay is the $335 filing fee. This alone is prohibitively expensive for individuals who don’t have any income, but you can avoid paying it if you meet certain criteria. You must be filing as an individual and not a company, you can’t afford to pay it in installments, and the total combined monthly income for your family is less than 150% of the most recently published poverty guideline, which you can find here. If you check all of those boxes, you can file an exemption and avoid paying the fee.
Use your tax refund to pay the fees.
Tax season is typically a busy season for our Knoxville, TN bankruptcy attorneys. That’s because many people choose to use their refund to pay the fees and expenses associated with filing Chapter 7 bankruptcy. If you have no income now but were gainfully employed and paying taxes last year, we recommend holding on to the tax refund you receive. You can use it to pay down some or all of the costs required to file.
Let your creditors pay for your bankruptcy.
Another strategy we’ve recommended to individual clients is to simply stop paying off the unsecured debts you currently have. Rather than continuing to spend your money on things like credit card debt that will be forgiven by filing for bankruptcy, hold onto that money instead. This gives you some financial relief and allows you to save up the money you need to pay for the filing fee, financial courses, and attorney fees.
Ask for financial assistance.
Asking friends or family members for a loan isn’t always easy, but it could be a solution to help cover the expenses that come with filing for bankruptcy. However, if you do receive a loan, you need to let our legal experts know because how the loan is classified will affect your filing. If it’s given as a loan, for example, the person who provided it needs to be listed as a creditor. While the loan is discharged if bankruptcy is successfully filed, you can still pay the individual back per the agreement you two have. If it’s given as a gift, though, it has to be listed as part of your income. We’ll help you understand the best strategy for your situation.
Need Help Filing Bankruptcy?
Then contact the Knoxville, TN bankruptcy attorneys at DZ Law. Our team of legal professionals specialize in filing for bankruptcy, so we have the experience and knowledge needed to help you navigate this complex process. With all of our cases, we always take a client-first approach, which means we’ll keep an open and transparent line of communication, so you always know exactly where your case stands. Let us be the experts you need to successfully file for bankruptcy by visiting us online to learn more and set up an initial consultation.