Yes. Even if your spouse is not filing with you, their income has to be disclosed to the bankruptcy court. The court requires that all household income be disclosed. This can affect you in several different ways depending on whether you seek Chapter 7 or Chapter 13 protection.
In a Chapter 7 case, your combined household income is used to determine whether or not you qualify under the means test. If you are seeking a personal reorganization under Chapter 13, it is used to determine your disposable income. However, do not assume that this will cause your payments to be higher. With more people in the household come more expenses. Also, if your spouse has his or her own bills such as a car note, credit card payment, or loan payment, it can be listed as an expense and will therefore lower your disposable income.
Even though your non-filing spouse must disclose their income, they are in no way involved in your filing. In fact, your spouse’s name is usually not listed anywhere on the petition. If your spouse co-signed on any debt listed in your plan, then they will be listed as a co-debtor and will receive notice of the case. However, this should not be negatively reported on your spouse’s credit report. If the creditor does report negative activity on your spouse’s credit report, he or she needs to dispute the activity and seek legal counsel.
Whether you want to file a joint case, an individual case, or if you are not sure, a free consultation with one of our experienced attorneys can help you with your decision. If you are thinking about seeking debt relief please contact our office nearest to you to set up a private and confidential consultation with one of our licensed attorneys.