There is no "TurboTax" option to file Chapter 13 bankruptcy online.
Written by Attorney Eva Bacevice.
Updated August 17, 2020
There are services available today that claim to make it feasible to file a Chapter 13 bankruptcy online by yourself. But even if filing Chapter 13 bankruptcy on your own is possible, it is not recommended. Chapter 13 cases are much more complicated than Chapter 7 cases and have an extremely high rate of failure when filed without the assistance of an attorney. Regardless, you always have the right to represent yourself in any court proceeding, which is called representing yourself “pro se.”
Chapter 7 vs. Chapter 13
When you are considering filing an individual consumer bankruptcy case you are likely deciding between a Chapter 7 and a Chapter 13. A Chapter 7 case is what you think of as a traditional bankruptcy where you are generally able to walk away from all of your debts without having to pay anything back to your creditors. Chapter 7 cases are generally pretty straightforward and take about three to four months from start to finish. Once you get past the paperwork to file a Chapter 7, it is smooth sailing from that point forward. You’ll need to attend your creditors’ meeting, complete your approved credit counseling courses and then wait to receive your discharge.
What makes a Chapter 13 so much more complicated?
A Chapter 13 case is vastly more complicated than a Chapter 7 case, from requiring additional paperwork and an additional hearing to get the case approved, to continued maintenance over the three to five years it will take to obtain your discharge. The main difference between a Chapter 13 and a Chapter 7 is that a Chapter 13 revolves around a payment plan, where you repay some or all of your debts over the life of the plan. You might have to file a Chapter 13 because you did not qualify to file a Chapter 7, or if you are hoping to catch up on secured debt, like your house or your car.
The Chapter 13 plan
The Chapter 13 plan is an additional part of your bankruptcy filing, where you propose what payments you intend to make through the plan and what amounts are going to various creditors. You can include both past-due payments and current payments. You need to be able to show that you are able to afford and maintain the payments for the full length of the plan. A Chapter 13 plan will run for a minimum of three years and a maximum of five years.
The additional hearing, other than your creditors’ meeting, that you are required to attend in a Chapter 13 case is called a “Confirmation Hearing”. The Confirmation hearing is all about the Chapter 13 plan - you need to make certain that the Chapter 13 trustee as well as any creditors involved have all agreed to your proposed plan.
Complying with procedural rules and local requirements
When you file your Chapter 13 bankruptcy petition, the schedules and the Chapter 13 plan you, must make certain that you are in compliance with both procedural rules and local requirements. You will also need to attend and represent yourself in all court proceedings related to your case. More will be required of you in a Chapter 13 case.
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Pro se success rate
As a result of all the additional paperwork and complexities of the rules and hearings, there is an extremely high rate of failure for Chapter 13 cases filed pro se. There are a lot of moving parts to keep track of and a lot of ways things can go wrong. Common problems include problems with the plan itself, poor payment history, unresolved creditor objections to the plan, and unfeasible payment amounts. Very few Chapter 13 cases filed without an attorney are successful. In fact, less than one half of one percent (0.5%) of all Chapter 13 pro se filings are successfully confirmed.
Consequence of failure
If a Chapter 13 case is not successful you might be facing a dismissal with prejudice (meaning you cannot re-file at all or may have to wait a lengthy period of time), meanwhile you will be accruing more and more debt as time goes by, making it harder to come up with a workable repayment plan. Additionally, there are limitations placed on the automatic stay protection when you file consecutive Chapter 13 cases.
Exceptions - emergency filing
The exception where it might make sense to file a Chapter 13 pro se is if you are facing an emergency, like an imminent foreclosure. In this scenario there is an option to file a “skeleton case” (part of the paperwork) to enact the automatic stay as quickly as possible. You will need to file the remainder of the completed paperwork within 14 days, with or without an attorney.
Money saving options
Many attorneys will offer a free consultation to help you determine whether a Chapter 13 bankruptcy case is right for you. You can also explore Legal Aid or use the Upsolve Legal Aid Locator to find options in your area. Additionally attorneys will sometimes offer pro bono services if you qualify.
Currently, there is no “TurboTax” option for Chapter 13 cases. If you decide to file and represent yourself, you will have to fill out the forms the bankruptcy court provides, attend all court hearings, and make sure you are abiding by both the procedural and local rules. Representing yourself pro se is an option if you do not have the funds to pay an attorney, but an unsuccessful case could cost you more in the long run.