When filing for bankruptcy, you will be required to complete a set of documents, collectively referred to as the Bankruptcy Petition. The Bankruptcy Petition includes a cover sheet known as the Voluntary Petition, Bankruptcy Schedules A through J, where you will itemize your assets, list your creditors, and state your income and your expenses, a Chapter 7 Statement of Intention, regarding your secured debts and leases, a Statement of Financial Affairs, which will detail your financial situation for the past few years, and a means test form, which will determine whether you qualify for a Chapter 7 case.
Organizing Your Financial Information
Before filling out the information in your Bankruptcy Petition, gather and organize your financial documents. You may want to use an expandable folder and label each pocket according to the information requested in your Bankruptcy Petition. For example, label the first pocket, Schedule A, the second pocket Schedule B, and so on.
When you file your Voluntary Petition with the court, this will begin your bankruptcy case. In addition to your name, address, and residency information, you will also provide your social security number, and an estimate of the number of creditors and the total amount of your assets and your liabilities. You indicate whether you are filing for Chapter 7, Chapter 13, or some other Chapter of bankruptcy, and whether you have filed for bankruptcy before.
You must certify that the information contained in the Voluntary Petition is true and correct and is not being presented to the court for any improper purpose. Upon filing your Voluntary Petition, you will be assigned a case number, a judge, and a trustee, so that the court may properly administer your bankruptcy proceeding.
Real and Personal Property
You must list all of your real estate and personal property under Schedules A and B of the Bankruptcy Petition. This information allows the Trustee to examine your assets and initially determine what may be available for distribution in a Chapter 7 case or whether, in a Chapter 13 case, your plan meets the “liquidation test.” The liquidation test states that your unsecured creditors must receive more under your Chapter 13 Plan than they would otherwise receive under a Chapter 7 distribution of your assets.
On Schedule A, you list any real property that you own, its value, and provide information regarding any liens or secured claims against this property. Your real property may include your home or any other real estate in which you may have an interest, either individually, jointly, or as community property.
On Schedule B, you list all of your personal property, and provide a value for each item. The value that you use for these items is known as its replacement value, which is the price a retail merchant would charge at today’s market value for property of that kind, considering the age and condition of the property. (To learn more, see Schedule B in Bankruptcy.)
On Schedule C you list the property that you are claiming as exempt. Exempt property cannot be used to pay your creditor’s claims, which means you get to keep it. This may include all or a portion of your homestead, your automobile, and other personal property items. You must carefully review Schedule C and the exemption laws that apply to your State, so that you do not inadvertently lose important rights to your property. (To learn more, see Schedule C of the Bankruptcy Forms.)
Schedules D through F ask you to list your creditors according to the type of claim that they have. There are three different types of creditors: secured, unsecured priority, and general unsecured.
- Secured creditors are creditors that have a lien against your property. (To learn more, see Schedule D – Secured Debts.)
- The claims of unsecured priority creditors will be paid before the general unsecured creditors. Examples of priority creditors include claimants for tax debts, and for alimony and child support.
- General unsecured creditors comprise the balance of your creditors, and are generally your credit card debt, medical bills, and other miscellaneous creditors.
Once you compile your creditors and list them accordingly, you will also report how much that they are owed.
Executory Contracts and Unexpired Leases
If you are a party to an executory contract or unexpired lease, you must provide this information on Schedule G of your bankruptcy petition. Executory contracts are contracts in which performance is due on both sides. This means that both you and your creditor owe each other obligations under the terms of the contract. Unexpired leases are leases that have not yet terminated on the date that your bankruptcy petition is filed. In bankruptcy, you may have a right to continue under the terms of the contract or lease (known as “assuming” the contract or lease), or have them terminated by the Court (known as “rejecting” the contract or lease).
Income and Expenses
On Schedules I and J, you must list both your and your spouse’s income and household expenses. (To learn more, see Schedule I.)
On Schedule H, you provide the names and addresses of those persons who have guaranteed or co-signed any of your debts. This includes spouses, family members, friends, or others who are mutually obligated to pay your debt or must pay in the event of your default.
Statement of Financial Affairs
The Statement of Financial Affairs is comprised of 25 questions seeking information about your financial history and business transactions. Answer these questions carefully, as the trustee may evaluate certain aspects of your case, like reclaiming money or property for your bankruptcy estate, based upon the time periods from when your transactions took place. (To learn more, see The Statement of Financial Affairs.)
Statement of Intention
This form is to be completed by Chapter 7 debtors who own secured property or are a party to a lease for personal property, such as an automobile. With respect to secured property, you will state your intention to retain or surrender the property. If you are leasing property, you will state whether you plan to assume the lease. To learn more, see The Statement of Intention in Chapter 7 Bankruptcy.
Means Test Form
This form asks for more detailed income and expense information than Schedules I and J. The purpose of the means test form is to determine whether you qualify for a Chapter 7 case. You may qualify for a Chapter 7 if your income falls below your State’s median income, or after completing a complicated set of calculations as set forth on the form, your net income qualifies you for Chapter 7. (To learn more, see The Means Test & Chapter 7 Eligibility).
If you do not meet the Chapter 7 income requirements, then you may file a Chapter 13 case. In that case, you file a form very similar to the Chapter 7 means test form, which determines the amount of disposable income available to fund your Chapter 13 Plan, and whether Chapter 13 is feasible for you. (To learn more, see Chapter 13 Bankruptcy.)