Updated April 17, 2020
When you don’t make enough to pay the bills, filing for bankruptcy in Washington can be a good solution. If you don’t know much about bankruptcy, learning about the differences between Chapter 7 and Chapter 13 bankruptcy is the best place to start. Next, you’ll want to know:
Not only will this article explains these key concepts, but it will help you find the official bankruptcy forms, approved educational courses, your local bankruptcy court, and more.
The means test measures your income and debt. The outcome will determine which chapter you’ll need to file to discharge (erase) debt.
The necessary income charts and expense guidelines are on the U.S. Trustee’s website (select “Means Testing Information”).
An important part of deciding the best chapter for you is determining whether you’ll lose any property. Don’t worry—you won’t lose everything. In fact, you might not lose anything at all.
Finding out which assets you can protect is as simple as looking at Washington’s bankruptcy exemption law. A list of federal bankruptcy exemptions exists, too, and Washington lets residents choose between the two lists. If you use Washington’s bankruptcy exemptions, you can also use the federal nonbankruptcy exemptions if they’re helpful.
Here's what will happen to nonexempt property (things you can’t protect with an exemption):
Here are some commonly used Washington bankruptcy exemptions. Unless indicated, all references are to the Revised Code of Washington (RCW) which you can find on the Washington State Legislature website.
The homestead exemption protects up to $125,000 of equity in a debtor’s home or principal residence, including a manufactured or mobile home. The exemption is reduced to $15,000 for other personal property used as a residence. (RCW §§ 6.13.010, 6.13.020, 6.13.030.)
Find out more in The Washington Homestead Exemption.
A debtor can exempt up to $3,250 in one motor vehicle. Spouses jointly filing can each exempt a vehicle. (RCW § 6.15.010(1)(d)(iii).)
A filer can exempt up to $3,000 worth of any type of personal property other than wages with the following limitations: no more than $1,500 total in cash and $500 total for bank accounts; however a filer with consumer debt can exempt $2,000 in bank accounts, and a filer with student loan debt can protect $2,500 in bank accounts. (RCW § 6.15.010(1)(d)(ii).)
You’ll find more Washington exemptions in Washington Bankruptcy Exemptions.
You’ll use this information when you’re ready to prepare your paperwork and file your case.
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).
Most people must pay something to file for bankruptcy, but it’s usually worth the cost. Here’s what you can expect.
Washington has two federal judicial districts with a bankruptcy court. Each court’s website has the court’s local rules and instructions for filing your paperwork. (Click “Bankruptcy Resources” and “Filing Without an Attorney.”)
The districts also have division locations, but not all are staffed. To determine where to file your case, visit the Federal Court Locator page, choose "Bankruptcy," and then enter your location information. You can also contact a court clerk at the numbers listed below.
|Eastern District of Washington||Western District of Washington|
904 West Riverside Avenue
402 East Yakima Avenue
700 Stewart Street, #6301
Seattle, Washington 98101
1717 Pacific Avenue, Suite 2100
Tacoma, Washington 98402-3233
Marysville Municipal Court
1015 State Avenue
Marysville, Washington 98270
500 W. 12th, 2nd Floor
Vancouver, Washington 98660
Kitsap County Courthouse
614 Division Street
Port Orchard, Washington 98366
This overview provides resources that will help a filer find information when preparing a bankruptcy filing; however, additional information is needed. Each filer must understand bankruptcy law and procedure and how it will affect the case. If you plan to file without an attorney, consider buying a do-it-yourself book like How to File Chapter 7 Bankruptcy by Attorney Cara O’Neill and Albin Renauer J.D.