What Are the Requirements for Filing Bankruptcy in South Carolina?

Filing for bankruptcy in South Carolina is a significant decision that requires careful consideration of various legal requirements. Understanding these requirements can help individuals and businesses make informed choices about their financial futures. Below are the essential criteria for filing bankruptcy in South Carolina.

1. Eligibility for Bankruptcy Chapters

In South Carolina, individuals typically file under Chapter 7 or Chapter 13 bankruptcy. To qualify for Chapter 7, you must pass the means test, which evaluates your average monthly income against the median income for a similar household in the state. If your income is below the median, you may qualify for Chapter 7. If it is above, you might have to file for Chapter 13 instead.

2. Credit Counseling Requirement

Before filing for bankruptcy, individuals are required to complete a credit counseling course from an approved provider. This course must be taken within 180 days before submitting your bankruptcy petition. The purpose is to help you assess your financial situation and explore alternatives to bankruptcy.

3. Filing the Bankruptcy Petition

To officially file for bankruptcy, you will need to submit a bankruptcy petition and various accompanying documents to the Bankruptcy Court in South Carolina. This includes schedules of assets and liabilities, income statements, and a list of creditors. Accurate and complete disclosures are crucial, as any omissions can lead to delays or complications in your case.

4. Fees Associated with Bankruptcy

There are filing fees associated with bankruptcy. As of 2023, the fee to file Chapter 7 bankruptcy in South Carolina is approximately $335, while Chapter 13 bankruptcy filing fees are around $310. If you cannot afford these fees, you may be eligible to apply for a fee waiver.

5. Identification and Documentation

When filing for bankruptcy, you must provide valid identification and social security numbers for all parties involved in the filing. Additionally, you should gather financial documentation, including tax returns for the past two years, pay stubs, bank statements, and a record of your debts and assets.

6. Job and Income Requirements

For Chapter 13 bankruptcy, you must have a steady source of income to propose a repayment plan to settle your debts over three to five years. The income can come from wages, self-employment, or other reliable sources. Additionally, there are limits on the total debts you can owe to qualify for Chapter 13, which are updated periodically.

7. Previous Bankruptcy Filings

Your eligibility can also be affected by previous bankruptcy filings. If you have filed for Chapter 7 bankruptcy in the past eight years, you are not eligible to file again. Similarly, prior Chapter 13 filings may impact your ability to refile within specific time frames.

Conclusion

Understanding the requirements for filing bankruptcy in South Carolina is vital for making informed decisions about your financial situation. If you are considering bankruptcy, consulting with a qualified bankruptcy attorney can help navigate the process effectively and ensure compliance with all legal prerequisites.