Can an Undocumented Immigrant File for Bankruptcy?

If you are a foreign national in the United States without permission (in other words, an undocumented immigrant, also called an illegal alien) and you are deeply in debt, you might be able to file for bankruptcy relief like anyone else. But you will likely need to have either a valid Social Security number or an Individual Taxpayer Identification Number (ITIN) in order to do so. In addition, because a bankruptcy filing is a public record, it's in your best interest to speak with an immigration attorney to learn about how filing for bankruptcy might affect your immigration status or future prospects.

To learn more about other bankruptcy rules and filing considerations, see these Bankruptcy Basics.

Undocumented Immigrants Are Allowed to File for Bankruptcy

U.S. bankruptcy laws do not require debtors to be U.S. citizens or legal residents in order to file for bankruptcy relief. Typically, as long as you live (or have a domicile), have a business, or own property in the United States (or a municipality), you are eligible to file for bankruptcy.

One potential hurdle, however, is that all debtors must prove their identity to the court. Usually that means showing a valid government-issued identification and proof of a Social Security numbers or ITIN. This means that if you don't have a Social Security number, you will probably need to obtain an ITIN from the IRS prior to filing your banksruptcy case.

What Is an ITIN?

An ITIN is a tax-processing number issued by the Internal Revenue Service (IRS). It is commonly used by people who are not eligible to receive a Social Security number, such as undocumented immigrants. ITINs are issued without regard to U.S. immigration status.

Also see, What's the Difference Between an ITIN Taxpayer Number and a Social Security Number?.

How Would an Undocumented Immigrant Have a Social Security Number?

Not even foreign nationals who legally enter the United States are necessarily eligible for a Social Security number, though some are. One would need to have permission to work first.

Such permission is automatic for nonimmigrants (temporary visa holders) who are coming to accept employment here, petitioned by a U.S. company. Examples include H-1B temporary specialty workers and L-1 intracompany transferees.

There also exist visa or immigration categories that don't automatically come with work privileges, but where the person can request an employment authorization document (an EAD or work permit) from U.S. Citizenship and Immigration Services (USCIS). Examples include F-1 students in some circumstances (such as severe economic hardship) and some people with pending asylum applications, and J-2 spouse or unmarried children of a J-1 visa holder.

For more on who can apply for an EAD, see What Is Form I-765, Application for Employment Authorization?.

If a foreign national overstays their permitted stay under a visa and thus becomes undocumented, they will still have a valid Social Security number, though not necessarily any right to work. (In fact, the Social Security Administration puts "Valid Only With DHS Authorization" on some nonimmigrants' Social Security cards, namely that of those who must separately obtain a work permit.)

Caution: Talk to an Immigration Attorney

A bankruptcy filing is a public record that anyone can access. If you are an undocumented immigrant, filing for bankruptcy can potentially have negative consequences with regard to your immigration status. For this reason, it is important that you talk to a knowledgeable and experienced immigration attorney in your area prior to filing your case.

To learn about other eligibility criteria to file for bankruptcy, see Eligibility for Chapter 7 Bankruptcy and Are You Eligible for Chapter 13 Bankruptcy?