January 18, 2018
If you need a way to control your debt, filing for bankruptcy in Louisiana might be the answer. The first step is learning the differences between filing for Chapter 7 and Chapter 13 bankruptcy. Once you know which chapter will be best for you, you’ll gather your financial documents and complete the paperwork.
This article will help you find other information you’ll need, like official bankruptcy forms, Louisiana means test figures, credit counseling providers, and your local bankruptcy court. You’ll also learn about protecting your property when you file bankruptcy in Louisiana.
Official Bankruptcy Forms
Before the Louisiana bankruptcy court discharges (forgives) your qualifying debt, you must disclose all aspects of your financial circumstances. You’ll include details about your property, credit accounts, income, expenses, and financial transactions on official forms that you can download from the U.S. Courts form page.
Your case will start when you file the paperwork in the Louisiana bankruptcy court along with a filing fee or a request for a fee waiver. You’ll also include proof that you’ve completed the required credit counseling course (more below).
Louisiana Bankruptcy Information
Even though federal law governs bankruptcy filings, some parts of Louisiana law and procedure will also apply.
Means Testing and Credit Counseling Information
On the U.S. Trustee’s website, you’ll have access to two types of information specific to Louisiana: means testing figures and approved credit counseling providers.
- Means test data. Before you qualify to have debt discharged in a Chapter 7 bankruptcy, you’ll have to pass a “means test.” You can pass in one of two ways: If your family income is lower than Louisiana’s median income or if you don’t have enough income to make a significant creditor payment after subtracting allowed expenses. The income charts and expense figures are under “Means Testing Information.” If you choose Chapter 13 bankruptcy instead, a similar calculation will help to determine your monthly plan payment.
- Credit counseling providers. Before filing a bankruptcy case, most filers must complete a session with a credit counseling service. After filing. debtors must take a debt management course. You’ll find approved providers under “Credit Counseling & Debtor Education.” Scroll down to your federal district.
Louisiana Bankruptcy Court Locations and Websites
Louisiana has three federal districts and each has a website where you'll find information on the court's local rules and filing procedures. (Click on the link below to go directly to a website.)
For guidance on where to file your case, contact one of the offices listed below or consult the Federal Court Locator, and choose “Bankruptcy” in the “Court Type” drop-down box.
Louisiana Bankruptcy Exemptions
You won’t lose all of your property when you file for bankruptcy, but you might not be able to keep everything.
- Protecting property. The assets you can exempt (protect) must appear on the list of exemptions available to Louisiana residents. You might also be able to claim certain federal non-bankruptcy exemptions.
- At-risk property. The Chapter 7 trustee can seize and sell any property that you can’t exempt. The proceeds will be used to benefit your creditors. If you file a Chapter 13 case instead, the process is a bit different. You’re allowed to keep your nonexempt assets as long as you pay its value to your creditors through the Chapter 13 repayment plan.
- Marital property. In Louisiana, spouses filing a joint bankruptcy will each be able to claim exemptions on property they both own, in effect doubling the amount of the exemption for many items (but not for the homestead).
Below are bankruptcy exemptions commonly used in Louisiana. The statute citations are to the Louisiana Revised Statutes Annotated.
- Homestead or residential property. Up to $35,000 in equity in your home and land on which it sits, limited to five acres in a town or city or 200 acres outside of a metro area. For obligations arising as a direct result of a catastrophic or terminal illness or injury, you may exempt the full value of the home. Spouses cannot double the Louisiana homestead exemption. (La. Rev. Stat. Ann. § 20:1.)
- Insurance benefits. Some life insurance benefits, including the insurance proceeds for exempt property damaged by a natural disaster, fraternal benefit society benefits, and accident and health insurance proceeds. (La. Rev. Stat. Ann. §§ 13:3881, 22:558, 22:564, 22:646, 22:647.)
- Motor vehicles. Up to $7,500 of equity in one motor vehicle used by you and your family. You might also exempt up to $7,500 of equity in one motor vehicle which is modified or fitted to assist you or a family member with a physical disability. (La. Rev. Stat. Ann. § 13:3881(A)(7), (8).)
- Personal property. Household goods and furnishings, appliances, clothing, family portraits, arms and military accoutrements, musical instruments, poultry, fowl, one cow, dogs, cats, other household pets, and wedding or engagement rings up to $5,000 in value (La. Rev. Stat. Ann. § 13:3881); Federal Earned Income Tax Credit (La. Rev. Stat. Ann. § 13:3881); guns and ammunition up to a value of $2,500.
- Pension, retirement, and life insurance benefits. All qualified pensions, tax-deferred arrangements, annuity contracts, and proceeds of and payments under tax-deferred arrangements and annuity contracts. (La. Rev. Stat. Ann. § 13:3881.) You might also be able to use federal nonbankruptcy exemptions to protect some retirement funds.
- Wages. 75% of disposable earnings or 30 times the federal minimum wage, whichever is greater. (La. Rev. Stat. Ann. § 13:3881.)
- Tools of the trade. Tools, instruments, books, and one utility trailer. (La. Rev. Stat. Ann. § 13:3881.)
From time to time, Louisiana will adjust these exemption amounts, and additional exemptions exist. You’ll want to make sure you’re using all available exemptions and the most recent figures. You can check the Louisiana statutes on the website for the Louisiana Legislature or contact a local bankruptcy attorney.
This article cannot provide all information necessary when filing for bankruptcy. Each filer is responsible for understanding the law and procedure. A do-it-yourself book like How to File Chapter 7 Bankruptcy by Attorney Cara O’Neill and Albin Renauer J.D. can provide information you’ll need to make important decisions in your case.