Cite as: Keith M. Lundin, Lundin On Chapter 13, § 36.7, at ¶ ____, LundinOnChapter13.com (last visited __________).
11 U.S.C. § 521(a)(1) requires Chapter 13 debtors, “unless the court orders otherwise,” to file a schedule of assets and liabilities, a schedule of current income and current expenditures, and a statement of financial affairs. Careful completion and filing of Official Bankruptcy Forms 6, 7 and 22C will satisfy most of the statutory requirements of § 521(a)(1). Failure to file these documents is a ground for conversion or dismissal of the case (but only on the motion of the U.S. trustee).1
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA)2 added filing requirements to § 521(a)(1), “unless the court order otherwise”:3 a certificate of the § 342 notice,4 copies of payment advices received within 60 days before filing,5 statement of monthly net income,6 and statement of reasonably anticipated increase in income and expenses.7 Additional filing duties are found in Bankruptcy Rule 1007(b) and in other subsections of § 521: Rule 1007(b)(6) requires the Chapter 13 debtor to file a statement of current monthly income formalized as Part I to Official Bankruptcy Form 22C;8 Code § 521(b) requires the debtor to file a certificate of completion of the prebankruptcy briefing required by § 109(h);9 § 521(c) requires the filing of any record of an interest in an education retirement account;10 and §§ 521(e) and (f) contain complex obligations for filing and providing tax returns to the trustee and creditors.11
The schedules contained in Official Bankruptcy Form 6 and the statement of financial affairs in Official Bankruptcy Form 712 must be filed with the petition or within 15 days after filing the petition.13 If a schedule of liabilities is not filed with the petition, then the petition must be accompanied by a list of creditors.14 The schedules and statement of financial affairs are long and detailed and must be completed very carefully. They contain most of the information that creditors, the trustee and the court will consider to determine confirmation of the plan. The plan itself, however, is a separate document.15
Each question in the schedules and statement of financial affairs must be answered for each debtor, with separate answers for husband and wife. All parts of every question must be answered. For example, the debtor’s present employer must be identified by name, address and telephone number to include any badge or card number used by the employer to identify the debtor. This detail may be critical if a payroll deduction order is issued to the employer.
Official Bankruptcy Form 6 contains 10 separate schedules lettered A through J. The form begins with a “Summary of Schedules” on which the debtor must summarize the information contained in each of the other individual schedules. The Summary of Schedules should be filled out last.
The general instructions to Official Bankruptcy Form 6 are very important. Schedules D, E and F to Official Bankruptcy Form 6, discussed in detail below, are lists of all creditors organized by whether the claims are secured, unsecured priority or unsecured nonpriority. The general instructions to Official Bankruptcy Form 6 state emphatically that Schedules D, E and F “have been designed for the listing of each claim only once.” The instructions explain:
Even when a claim is secured only in part or entitled to priority only in part, it still should be listed only once. A claim which is secured in whole or in part should be listed on Schedule D only, and a claim which is entitled to priority in whole or in part should be listed on Schedule E only. Do not list the same claim twice. If a creditor has more than one claim, such as claims arising from separate transactions, each claim should be scheduled separately.
Violating this general instruction will mess up the mathematics of the schedules and in particular render the Summary of Schedules inaccurate. This can produce all sorts of unnecessary trouble. The debtor may appear to be ineligible when the correct listing would demonstrate eligibility, or vice-versa. It takes a little practice to master the design of Official Bankruptcy Form 6.
Each schedule requires information from both a husband and wife if filing a joint case. For example, where a schedule calls for information about the ownership of property, the debtor must describe ownership as “H” for “husband,” “W” for “wife,” “J” for “joint” or “C” for “community.” If no entry is to be made or the question is not applicable, the debtor is required to enter “none.” In a joint husband-wife case, these divisions of debts and property are usually not complicated because most assets and debts are jointly owned or obligated. When only one spouse files, joint debts are fully the obligation of the filing spouse, but classification of debt as secured and unsecured for eligibility and confirmation purposes may depend on whether the collateral is owned by the filing or the nonfiling spouse.16
Especially in cases filed after BAPCPA, counsel must be alert for cases in which the husband and wife have acquired separate property and incurred separate debts. The peculiar treatment of “spouses” in the projected disposable income test as reformulated by BAPCPA17 demands careful attention before filing any joint petition. Substantive consolidation of a joint husband-wife case is not automatic.18 There will be cases in which the presence of separate assets or liabilities will make it in the best interests of one or both of the spouses to separate petitions and administer the cases separately. Careful attention in the schedules to identifying jointly owned property and jointly owed debts is also essential to establish the predicate for separate classification and different treatment of joint debts under § 1322(b)(1).19
1 See §§ 311.2 [ Conversion on Request of Creditor or Trustee ] § 141.2 Conversion on Request of Creditor or Trustee and 312.1 [ Cause for Conversion ] § 141.3 Cause for Conversion.
2 Pub. L. No. 109-8, 119 Stat. 23 (2005. See § 387.1 [ New Filing Requirements and Other Duties: A List ] § 42.1 Filing Requirements and Other Duties: A List for a list of new filing requirements and duties under the Code as amended by BAPCPA.
3 After BAPCPA, there are important reasons to sometimes request relief from some of the filing requirements in § 521(a). See §§ 388.1 [ Consequences of Failure to File Required Information, Including “Automatic Dismissal” ] § 42.2 Consequences of Failure to File Required Information, Including “Automatic Dismissal” and 468.1 [ Current Monthly Income: The Baseline ] § 92.3 Current Monthly Income: The Baseline.
4 See §§ 36.9 [ Section 342(b) Certificate ] § 36.32 Section 342(b) Certificate and 375.1 [ Certificate of § 342(b) Notice ] § 36.33 Certificate of § 342(b) Notice after BAPCPA.
5 See § 42.3 Payment Advices.
11 See § 42.4 Tax Return Duties—In General, § 42.5 Tax Return Duties Seven Days before First Scheduled Meeting of Creditors, § 42.6 Tax Return Duties One Day before First Scheduled Meeting of Creditors, § 42.7 Tax Return Duties—On Request, § 42.8 Consequences of Failure to File or Provide Tax Returns and § 42.9 Tax Return Confidentiality Issues
12 See § 36.1 [ Statement of Financial Affairs ] § 36.22 Statement of Financial Affairs.
13 Fed. R. Bankr. P. 1007(b)(1), (c).
14 See § 34.3 [ List of Creditors and Addresses ] § 36.4 List of Creditors and Addresses.
15 See § 36.2 [ Plan ] § 36.24 Plan.
16 See § 18.1 [ Joint Obligations of Spouses and Codebtors; Collateral That Is Not Property of the Estate ] § 17.3 Joint Obligations of Spouses and Codebtors; Collateral That Is Not Property of the Estate.
17 See § 473.1 [ Accounting for Spouses ] § 94.3 Accounting for Spouses.
18 See § 7.1 [ Debtor Must Be an Individual ] § 10.1 Debtor Must Be an Individual; Spouses Allowed.
19 See § 150.1 [ Co-signed Debts ] § 87.3 Co-signed Debts. See, e.g., In re Chandler, 148 B.R. 13 (Bankr. E.D.N.C. 1992) (Because under North Carolina law, property owned by the entireties is only subject to the claims of creditors of both spouses, husband and wife Chapter 13 debtors can separately classify their joint debts for more favorable treatment than given the debts of only one or the other spouse.).