Ohio Bankruptcy Laws & Rules
The bankruptcy laws and rules generally come from the federal court system. The Bankruptcy Code is in effect throughout the United States. Where Ohio bankruptcy laws and rules are slightly different are primarily in the aspects of the federal code that incorporate local data, and in the local rules enforced by each District Court. The local rules instruct debtors and their attorneys on how the court accepts documents, calculates its deadlines, and expects its fees. The Bankruptcy Code limits Chapter 7 eligibility to those who can pass a means test based on the state's median family income, and the list of property exempt from liquidation is unique to the state. For Chapter 13, a debtor's income is based on local and regional expense deductions.
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Districts
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Each state has at least one federal Bankruptcy Court. Ohio is divided into a Northern District and a Southern District. The Northern District of Ohio has divisional offices in Toledo, Akron, Cleveland, Canton and Youngstown, each of which serves specific counties in their vicinity. The Southern District has offices in Dayton, Columbus and Cincinnati. The court's Web pages (find links in the Resources section) include maps of each district and address for each court location.
Median Income
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The Chapter 7 means test is based on median family income figures published by the U.S. Census Bureau. A bankruptcy debtor must average their monthly income for the previous three months and multiply by 12. To qualify, the product must be below the median income for their household size. In 2009, the median income for a single wage earner in Ohio was $42,458. The median for a family of two was $52,922. For three it was $62,251, and for four, $74,234. For each additional member of a household in excess of four, add $6,900 to calculate the appropriate median income level.
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Expenses
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To qualify for Chapter 13, the bankruptcy trustee will evaluate the debtor's ability to repay their debts from their disposable income over a five-year (60 month) period. To do so, certain expense deductions are subtracted from the debtor's average monthly income. The maximum allowable limits are determined by standards compiled by the Internal Revenue Service (IRS). For example, in Cleveland in 2009, a debtor could deduct up to $186 for the ownership and operating expenses of a single vehicle. In Licking County, $1,528 could be deducted for the housing and utilities expenses of a family of four. For more information, see the Resources section.
Filing and Fees
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It's crucial to examine the local rules prior to filing in any court. For example, in the Bankruptcy Court for the Southern District of Ohio, electronic filing is mandatory. In the Northern District, it is optional; typed or handwritten documents can be submitted with three additional copies. Each district has very specific requirements, down to font, type size and number of characters per line, but different specifications for the case matrix, a mandatory document that contains the names and addresses of all creditors and their counsel. In both districts, it's necessary to pay filing fees at the time of filing. As of 2009, these range from $245 for Chapter 13 to $299 for Chapter 7. A request can be made to pay in installments, but the Northern District doesn't accept credit cards or third-party checks, while the Southern District accepts credit cards with prior approval.
Exemptions
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The federal property exemptions are not available to debtors in Ohio. The state's exemptions protect at least 75 percent of disposable weekly earnings. They also cover $5,000 for a residence, $600 in monthly disability benefits, some types of life insurance, alimony and child support payments necessary for support, property of a business partnership, and various forms of public benefits like unemployment, worker's compensation, and victim's compensation. Personal property can also be exempted, up to a total of $1,500 or $2,000 if no homestead exemption is claimed, for animals, crops, books, musical instruments, household goods and appliances, furniture, firearms and fishing gear (a maximum $200 per item, or up to $400 for one item of jewelry). Additionally, there's a wild-card exemption of $400 applicable to any property.
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References
Resources
- Photo Credit U.S. Courts
