FIling and moving

[heartheart]

I am starting to think about filing bk, but I'm not sure how to handle this one thing. We rent a house currently that is very expensive. We've been given the opportunity to live in a relative's house rent free in another state and have decided to move next month. In our current state, we would easily pass the means test for 7, but in the state we're moving to, we would definitely fail it. Can we still file here even if we move to another state? If so, does it have to be done in a certain time period? How does this work?

[justbroke]

You may want to file before you move. Besides, there are "residency" as well as "exemption" requirements for filing. It's much easier to file in a State and subsequently move, than to move and try to "immediately" file in the new State.

Residency (and Venue) for all States (Districts) require 90-days of residency. You must file in the State where you lived the majority of time in the preceding 180-days. So, just file in the State you live now!

I think it's less complex to file... attend your 341 meeting (about 30 days out) and then move! Maybe someone will differ with me, but filing in a new State raises too many other issues, such as which exemption scheme to use.

[heartheart]

I guess my real question is, can you file in a state you no longer live in (assuming that's where you've spent the majority of your 180 days)? I definitely don't want to file in the new state if I don't have to because it appears I would not pass the means test there.

I don't think I'll be able to file before I move because I don't think I'll be able to afford the attorneys fees in the next month, especially with all the expenses of moving. I know I would have to return to attend the 341.

[justbroke]

Yes you can, but it causes exemption issues! I would only do this if I talked to attorneys BEFORE moving and that I understood the ramifications of that decision.

It can actually be advantageous to move first, wait 91 days, and then file IF the residency requirements of your new State are not met for exemptions and you are forced to use the Federal Exemptions which could be very beneficial... depending on which State you're moving to/from. It's a calculation that you must take seriously and determine what is better financially.

Again, it appears that you want to file in the State in which you live now, and that may be the better choice. I'm just saying that there is more to it than just the residency requirement for "venue". There's also a residency requirement (usually) for exemptions as well!

[duraflame]

can you file and then move to a different city in the same state during the process??

[heartheart]

Yes you can, but it causes exemption issues! I would only do this if I talked to attorneys BEFORE moving and that I understood the ramifications of that decision.

It can actually be advantageous to move first, wait 91 days, and then file IF the residency requirements of your new State are not met for exemptions and you are forced to use the Federal Exemptions which could be very beneficial... depending on which State you're moving to/from. It's a calculation that you must take seriously and determine what is better financially.

Again, it appears that you want to file in the State in which you live now, and that may be the better choice. I'm just saying that there is more to it than just the residency requirement for "venue". There's also a residency requirement (usually) for exemptions as well!

OK now I'm very confused! The state in which I file will determine my exemptions, correct? If I file in my current state (where I have lived for several years so I would meet the residency requirement, I'm assuming), I would be using those exemptions necessarily, right? It appears from what I've found online that both states require you to use the state exemptions and don't allow the federal ones. Although, I don't think it would make a huge difference as I have very few assets to exempt besides a decade-old car, a small-ish fund for my kids (though it's in my name), and an engagement/wedding ring.

Thanks for answering my questions!

[tobee43]

we moved to another state to live and as well it was a better state and more creditor friendly than the state we were moving from.

here were our choices. as jb points our the residency rules will apply, however you may also be able to have the right to chose to file federally when making that type of moved you are not necessarily forced to out with that's state statues.

in our case we went underground in our "new" state for 2 years so that we could take advantage of their wild card exemption, where as if we followed the 180 rule we were not be able to have taken it. we most likely still would have been better off that we would have had be filed federally, which was our choice if we didn't wait out the time period.

also just a suggestion; if you are renting from a relative, make certain you have proof of your rental payments etc. we also did that and had no problems since we used our checking account to pay our rent and it was consistent as well as our utilities in our new state. that way there can be no question from the trustee about your "new" expenses.

[ksgirl38]

I guess I'm a little confused by some of the information in this thread. At the first consultation I went to the attorney mentioned that the BK could get me out of my lease. I didn't really take it seriously at the time, but I live in a city that borders another state and work in that other state so I thought later on I thought mayble for tax reasons I should consider it. At consultation #5 I was reminded that if I moved to the other state I would have to wait out the 90 days before filing. So are you saying that's you can move and file in the state you moved from? Just curious because that's how I interpreted what was in this thread and that's very different than what the attorneys told me.

[LadyInTheRed]

So are you saying that's you can move and file in the state you moved from? Just curious because that's how I interpreted what was in this thread and that's very different than what the attorneys told me.

It's confusing. The relevant law is 18 USC Section 1408: http://www.law.cornell.edu/uscode/text/28/1408

If you move within 180 days of filing, you file where you have lived for the longer portion of the last 180 days. So, assuming you only moved once during that 180 days, you file in the old state if it's been 90 days or less since you moved and in the new state after the 91st day. If you've moved more than once, you have to figure out where you spent the most time.

What state's exemptions you use is a separate question and a very important one. It is possible to file in one state, but be required to use another state's exemptions.

I agree with JB that the OP should consult with a BK attorney before moving.