If you are considering bankruptcy and you’re self-employed, you may have more paperwork involved than the average filer. Proof of income will be your biggest challenge to provide to the bankruptcy court. If your figures are inaccurate, the judge may believe you are attempting to defraud the bankruptcy system. The court will need accurate income figures to determine your eligibility for Chapter 7 bankruptcy. Or, if you decide to file Chapter 13 bankruptcy, your income will determine how much of your debts you will need to repay.
Documents
If your small business keeps profit and loss statements, this will make getting your documents a little easier. Printing out and submitting your profit and loss statement for the six months before filing bankruptcy will help clarify your income. If you do not have up-to-date records, you may need to go back through your files and create a document showing this data.
Checks
Sometimes self-employed people get checks as a form of payment. If you have check stubs or copies of client’s checks that your bank can provide, this will help verify your income.
Bank statements
Another way to document your income is to provide bank statements. Bank statements help complete the profit and loss forms required by the bankruptcy trustee in court. As soon as you determine that you will be filing bankruptcy, don’t waste any time gathering up all of your documents since some may take a while to come from the bank or other sources.
Contacting a Hidalgo County bankruptcy attorney can help you with your filing and eliminate all of your qualifying debt.