Are you planning to file for bankruptcy in Minnesota? Although federal law controls most of bankruptcy (including the filing process), there is some Minnesota-specific information you will need to file for bankruptcy. You can obtain much of the information you need online. Here's how. (For more articles on the filing process, see Filing for Bankruptcy.)
In order to qualify for Chapter 7 or Chapter 13 bankruptcy, you must show that you received credit counseling from an agency approved by the U.S. Trustee in Minnesota within the six month period before you file for bankruptcy. You’ll also have to take a debtor education course before you get a bankruptcy discharge. (To learn more about this requirement, including the rare exceptions, see Credit Counseling & Debtor Education Requirements in Bankruptcy.)
Minnesota has a set of bankruptcy exemptions which help determine what property you get to keep in Chapter 7 bankruptcy, and play a role in how much you repay unsecured creditors in Chapter 13 bankruptcy. For a list of other common exemptions in Minnesota, see Minnesota Bankruptcy Exemptions.
Minnesota bankruptcy filers also have the option of choosing the federal exemptions offered in the Bankruptcy Code. (To learn about the federal exemptions, see The Federal Bankruptcy Exemptions.)
To learn about Minnesota’s exemptions for your home and car, see The Homestead Exemption in Minnesota and The Motor Vehicle Exemption in Minnesota. To find other Minnesota exemptions, visit our Bankruptcy Exemptions area.
When you file for Chapter 7 or Chapter 13 bankruptcy, you must complete multiple forms, including a bankruptcy petition, a number of schedules containing detailed information about your property and your finances, and several other forms, including a lengthy form known as the “means test” (for Chapter 7) and a similar form for Chapter 13.
(For a list of the forms you must complete, see The Bankruptcy Forms: Getting Started.)
For more information about each of the official forms, including how to find them and fill them out, see Completing the Bankruptcy Forms.
When you file for bankruptcy in Minnesota, you must compare your income to the median income for a household of your size in Minnesota. If your income is less than the median, you will be eligible to file for Chapter 7 and, if you choose to file for Chapter 13, you can use a three-year repayment plan (rather than five years). This is called the means test.
If your income is above Minnesota’s median income, you still might qualify for Chapter 7, but you’ll have to provide detailed information about your expenses and payments on secured debts in order to find out. Most Chapter 13 filers also have to provide this information.
For information about each of these forms, including how to complete them, see:
Here’s how to find the Minnesota-specific figures for these means test forms:
Minnesota median income. For a one-person household in Minnesota, the median income is $46,161. For a family of two, the Minnesota median income is $61,170. You can find figures for other household sizes in Minnesota here. If you're married and want to file separately from your spouse, your spouse's income must still be included in your means test calculation.
Example. Jake and Sarah are married and have no children; their combined income before taxes is $60,000. Because this is less than the median for their household size, Jake and Sarah are below median debtors.
Standard deductions. Forms 22A and 22C have a comprehensive list of expense categories, such as housing, transportation, food, and childcare. For some of those categories (like childcare), you provide the actual amount you spend. For others, you plug in a predetermined amount -- sometimes that figure is standard for the whole country, other times it varies by county or region.
You can find all of the Minnesota area, borough, and region-specific figures you’ll need for Forms 22A and 22C on the U.S. Trustee’s website at www.justice.gov/ust. Click on “Bankruptcy Reform” and then “Means Testing Information.”
Example. In Minnesota, the standard amount you list on your bankruptcy papers for housing and utilities varies by county and by household size. For example, if you live in Hennepin County and you are single without dependents, your deduction for mortgage or rent is $1,225. If you live in St. Louis County, on the other hand, the mortgage or rent deduction for a household of one is $736. You can find housing expense standards for each Minnesota area here.
Some judicial districts and bankruptcy courts require bankruptcy filers to complete additional “local forms.” To find out if your court requires additional forms, contact the bankruptcy filing clerk. Some courts post these forms online on the court’s website. (Below you’ll find a link to Minnesota’s bankruptcy court.)
Since there is only one judicial district in Minnesota (see below for the link), you don’t need to worry about the rules for filing in the correct judicial district.
The main court locations are in Minneapolis and St. Paul where the bankruptcy judges sit, but there are additional court clerk's offices in Duluth and Fergus Falls.