To file for bankruptcy in Illinois, an individual must first complete credit counseling within 180 days prior to filing. The counseling must be conducted by a court-approved agency, and a certificate of completion must be filed along with the bankruptcy petition.
The next step is to file a bankruptcy petition with the United States Bankruptcy Court for the Northern District of Illinois. The petition must include information regarding the debtor's income, assets, liabilities, and expenses, as well as any outstanding debts.
To qualify for Chapter 7 bankruptcy, the debtor must pass the means test. This test determines whether the debtor's income is below the state median income for a household of their size. If the debtor's income is above the median, they may still qualify for Chapter 7 depending on their disposable income.
To qualify for Chapter 13 bankruptcy, the debtor must have regular income and their unsecured debts must be less than $419,275 and secured debts must be less than $1,257,850.
It is important to note that filing for bankruptcy has certain limitations and exceptions. For example, certain debts such as student loans, child support, and tax debts may not be discharged in bankruptcy. Additionally, filing for bankruptcy may not be the best option for everyone and other alternatives, such as debt settlement or consolidation, should be explored.
If an individual is considering filing for bankruptcy, it is recommended that they consult with a licensed attorney who can provide personalized advice based on their specific situation.
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