Chapter 7 Bankruptcy

Chapter 7 Bankruptcy in Utah

Chapter 7 Bankruptcy Attorneys serving Salt Lake City and all of Utah. Call today to discuss your situation with an experienced bankruptcy attorney.

What Is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is a "liquidation" bankruptcy that allows individuals and businesses to eliminate most unsecured debts quickly — typically within 3–6 months. In exchange, a bankruptcy trustee may liquidate non-exempt assets to pay creditors. Most Chapter 7 filers have few or no non-exempt assets, resulting in a "no asset" case where creditors receive nothing but debts are still discharged.

Who Qualifies for Chapter 7?

To qualify for Chapter 7, individual debtors must pass the "means test" — a calculation comparing your average monthly income to the median income for your state and family size. If your income is below the median, you automatically qualify. If above, you must show that after deducting allowed expenses, you do not have sufficient disposable income to fund a Chapter 13 repayment plan.

What Debts Can Be Discharged?

Chapter 7 can discharge most types of unsecured debt, including:

• Credit card debt
• Medical bills
• Personal loans
• Some tax debt (income taxes that are at least 3 years old and meet other requirements)

Debts that generally cannot be discharged include: student loans (with very limited exceptions), child support and alimony, most recent tax debt, and debts arising from fraud or willful misconduct.

Tax Debt and Chapter 7

As a tax and bankruptcy law firm, we have special expertise in determining which tax debts can be discharged in Chapter 7. Contrary to popular belief, certain older income tax liabilities meeting specific requirements may be dischargeable — a potential benefit that many bankruptcy attorneys without tax expertise overlook.

Contact Us Today

Call Michelle Turpin P.C. at (801) 685-0552 to schedule a confidential bankruptcy consultation.