Can I declare bankruptcy if my only income is Social Security?

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Question:

Can I declare bankruptcy if my only income is Social Security?

Answer:

If your only income comes from social security, you are not prevented from filing for Chapter 7 or Chapter 13 bankruptcy. 

In Chapter 7, you can discharge most or all of your debts. However, you may have to give up some property if it is not exempt. So, for example, if you have equity in your home that is not protected by a homestead exemption, the bankruptcy trustee may sell it to pay your creditors. To learn more about exemptions in bankruptcy, see Bankruptcy Exemptions -- What Do I Keep When I File for Bankruptcy

In Chapter 13 bankruptcy, you get to keep your property, but must repay your debts through a plan that lasts either three or five years. You must have enough income to fund the plan -- which might not happen if your only income is from social security. To learn more about how Chapter 13 works, see Chapter 13 Bankruptcy: An Overview.

Updated by: , J.D.

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