Bankruptcy Rules in Oklahoma

Oklahoma has state bankruptcy rules and regulations that residents must follow, even though in general court procedure follows federal bankruptcy law. For example, as a resident of Oklahoma, you must use Oklahoma median income to help determine if you qualify for Chapter 7 bankruptcy.

Qualification

As Chapter 7 does not mandate any payments for creditors, federal bankruptcy law requires you to qualify for Chapter 7 bankruptcy based in part on your income. As a resident of Oklahoma, you must compare your annual income with that of other similarly sized Oklahoma households using the most recent Census Bureau data. If the median income is higher than your annual income, you generally qualify to file Chapter 7. If you don't qualify, you must take the full bankruptcy means test as outlined on Bankruptcy Form 22A. In the means test, you are allowed to take deductions for expenses such as housing and utilities up to a certain limit defined by the Oklahoma county in which you live. If you still have enough income to pay creditors in a Chapter 13 bankruptcy, the court will not allow you to proceed with your Chapter 7 case.

Exemptions

In a Chapter 13 bankruptcy, since you are making payments to creditors you can keep all of your assets. In a Chapter 7 case, you may have to forfeit some of your property. Federal bankruptcy procedure allows each state to determine the amount of property that its residents may keep in a Chapter 7 case in the form of bankruptcy exemptions. In Oklahoma, you can keep a certain amount of property in nine categories, ranging from your homestead and personal property to wages and pensions. The amount that you may keep in each category is subject to change. If you have any property worth more than the corresponding exemption, your bankruptcy trustee will most likely confiscate that property.

Filing

As a resident of Oklahoma, you must submit your bankruptcy petition to the appropriate Oklahoma bankruptcy court. Oklahoma has three separate bankruptcy districts, each with jurisdiction over specific counties. For example, the Oklahoma Eastern Bankruptcy District presides over 26 Oklahoma counties and has one district court, located in Okmulgee. The Northern and Western Districts have jurisdiction over the remaining Oklahoma counties. When you submit your petition to the Oklahoma court, you must include a $299 filing fee (as of 2011) for a Chapter 7 petition and a $274 fee for a Chapter 13 case, same as in any bankruptcy court in America.

Residency

To file bankruptcy in Oklahoma, you must be a resident of the state. For bankruptcy purposes, you must have lived in Oklahoma for at least 730 days before you filed your petition in order to qualify as an Oklahoma resident. This provision in the bankruptcy code is aimed at preventing debtors from moving to another state to take advantage of more generous exemptions or median income qualification standards.

References

• U.S. Courts: Chapter 7
• U.S. Courts: Chapter 13
• The Bankruptcy Site: Oklahoma Bankruptcy Exemptions
• Nolo: Chapter 7 Bankruptcy -- Who can't File?
• U.S. Trustee Program: Means Testing -- Census Bureau, IRS Data and Administrative Expenses Multipliers
• Personal Bankruptcy Information: Oklahoma Courts

Resources

• U.S. Trustee Program: Census Bureau Median Family Income by Family Size
• Bankruptcy in Brief: Exemptions -- What can I Keep if I File Bankruptcy?
• The Standard Legal Law Library: An Overview of the Bankruptcy Act of 2005
• U.S. Courts: Bankruptcy Form 22A
• IRS: Oklahoma -- Local Standards -- Housing and Utilities
• U.S. Courts: Bankruptcy Filing Fees