January 25, 2019
If your bills are out of control and you’re wondering if you’ll be able to tame them, filing for bankruptcy can help. But finding the information you need to prepare your Wyoming bankruptcy paperwork can be challenging.
Here are the steps you’ll need to take.
Choosing the Right Bankruptcy Chapter
Understanding the differences between Chapter 7 and Chapter 13 bankruptcy will be your first step. Here are the basics:
- Chapter 7 allows low-income filers to wipe out qualifying debt without paying into a repayment plan. It takes about four to five months to complete.
- People who make too much to qualify for Chapter 7 can use Chapter 13 and pay into a five-year repayment plan. Chapter 13 works well to save a home from foreclosure, a car from repossession, or to pay off nondischargeable debt (debt that doesn’t go away in bankruptcy).
Qualifying for Bankruptcy in Wyoming—Means Testing
Next, you’ll determine whether you meet the chapter’s qualification requirements.
- Chapter 7 bankruptcy. You’ll meet income qualifications by passing the “means test.” If your family income is lower than the median income of your state, you pass and can receive a discharge in a Chapter 7 case. You might still pass the means test after subtracting certain standard expenses.
- Chapter 13 bankruptcy. If your income exceeds the Chapter 7 limits, you can repay some or all of what you owe in a five year Chapter 13 repayment plan. The tricky part here is that you must have enough income to pay all required debts. To determine your Chapter 13 bankruptcy payment, you’ll do a calculation similar to that in Chapter 7. You’ll pay the greater of your disposable income, the value of your nonexempt property, or the amount of your nondischargeable debt (such as support obligations and tax debt).
The income charts and expense guidelines are on the U.S. Trustee’s website (select “Means Testing Information”).
Protecting Property With Wyoming’s Bankruptcy Exemptions
You won’t lose everything when filing for bankruptcy in Wyoming. You might not lose anything at all. It will depend on Wyoming’s state exemptions and the federal nonbankruptcy exemptions. You can use both to protect your property. (Unlike some states, you won’t have the option of using the federal bankruptcy exemptions.)
What will happen to any nonexempt property you own—property you can’t protect with an exemption—will depend on the chapter you file.
- In a Chapter 7 bankruptcy, the trustee appointed to manage your matter will sell any property that isn’t exempt for the benefit of your creditors.
- By contrast, you can keep all of your property in a Chapter 13 bankruptcy. But, there’s a catch. You must pay the nonexempt property value to your creditors through the three- to five-year Chapter 13 repayment plan.
- Spouses who file together in Wyoming can double the exemption amount in each category (except for the homestead) as long as both spouses have an ownership interest in the asset.
Wyoming’s Bankruptcy Exemption List
Here are some common Wyoming bankruptcy exemptions. Unless indicated, all references are to the Wyoming Statutes Annotated or federal law.
Wyoming Homestead Exemption
A debtor can exempt up to $20,000 of equity in a home. (§§ 1-20-101, 102, 103, and 104)
Wyoming Motor Vehicle Exemption
Up to $5,000 of equity in a car, truck, van, SUV, motorcycle, or another vehicle can be protected with this exemption. (§ 1-20-106(a)(iv))
Other Bankruptcy Exemptions in Wyoming
Here are additional types of property you’ll be able to protect.
- Personal property. Unless otherwise stated, these exemptions are all found in § 1-20-105 and 106: bedding, furniture, household articles, and food, up to $4,000 per person in the home; bible, school books, and pictures; burial plot; clothing and wedding rings (but no other jewelry), up to $2,000; $3,000 in firearms (up to three) and ammunition (up to 1,000 rounds); medical savings account contributions (§ 1-20-111); prepaid funeral contracts (§ 26-32-102).
- Tools of the trade. Up to $4,000 of either: the library, instruments, and implements of a professional, or the tools, team, implements, or stock used in your trade or business. (§ 1-20-106(b))
- Pensions. Criminal investigators and highway officers (§ 9-3-620); firefighters’ death benefits (§ 15-5-209); game and fish wardens (§ 9-3-620); police officers (§ 15-5-313(c)); private or public retirement funds and accounts, including IRAs, Roth IRAs, and SEP IRAs (§ 1-20-110); public employees (§ 9-3-426). Tax-exempt retirement accounts, including 401(k)s, 403(b)s, profit-sharing, and money purchase plans, SEP and SIMPLE IRAs, and defined benefit plans, and IRAS and Roth IRAs to the current allowed amount. (For more information and the most recent figure, see Your Retirement Account in Bankruptcy.)
- Public benefits. Crime victims' compensation (§ 1-40-113); general assistance (§ 42-2-113(b)); unemployment compensation (§ 27-3-319); workers' compensation (§ 27-14-702).
- Insurance. Annuity contract proceeds to $350 per month (§ 26-15-132); disability benefits if the contract says you cannot use them to pay a beneficiary’s creditors (§ 26-15-130); fraternal benefit society benefits (§ 26-29-218); group life insurance or disability policy or proceeds, cash surrender and loan values, waived premiums, and dividends (§ 26-15-131); individual life insurance policy proceeds, cash surrender and loan values, waived premiums, and dividends (§ 26-15-129); life insurance proceeds held by the insurer if the contract says they cannot be used to pay the beneficiary’s creditors (§ 26-15-133).
- Miscellaneous. Liquor license and malt beverage permits (§ 12-4-604).
- Wages. Earnings of National Guard members (§ 19-9-401); 75% of your disposable earnings or 30 times the federal minimum wage, whichever is more (§§ 1-15-511, 1-15-408, and 40-14-505); wages of inmates in adult community corrections programs (§ 7-18-114); wages of inmates in correctional industries programs (§ 25-13-107); wages of inmates on work release (§ 7-16-308).
Wyoming’s exemption amounts adjust periodically, and additional exemptions exist. To make sure you have the most recent figures, and that you’re claiming all exemptions you’re entitled to, check for any updates on the website of the Wyoming Legislature or speak with an attorney.
More Wyoming Bankruptcy Information
The information that follows usually isn’t needed unless you’re ready to prepare your paperwork and file your case.
Wyoming Credit Counseling and Debtor Education Information
Individual filers must take two financial courses—one before filing and another before receiving a discharge (debt forgiveness). Approved providers are listed under “Credit Counseling & Debtor Education” on the U.S. Trustee’s website (be sure to scroll down to your district).
Bankruptcy Costs, Filing Fees, and Forms
Most people have to pay some amount to file for bankruptcy, but it’s usually worth the cost. Here’s what you can expect.
Wyoming’s Bankruptcy Court Website and Location
The Wyoming Bankruptcy Court has offices in Cheyenne and Casper. You’ll use the Cheyenne address for any mailings. Call the office of the Clerk of the Court at (307) 433-2200 to learn which office will have jurisdiction over your case.
On the Wyoming bankruptcy court website, you’ll find the court’s local rules and instructions for filing your paperwork. Click on “Filing Without an Attorney.”
U.S. Bankruptcy Court
District of Wyoming
2120 Capitol Avenue, 6th Floor
Cheyenne, WY 82001
U.S. Bankruptcy Court
District of Wyoming
111 South Wolcott
Casper, WY 82601
This overview cannot provide all of the information you’ll need to file a bankruptcy case. For more detailed information, consider consulting with a local bankruptcy lawyer or buying a self-help book such as How to File Chapter 7 Bankruptcy by Attorney Cara O’Neill and Albin Renauer J.D.