Some of the most frequently asked questions in our office are: Do you have to be a citizen to file for bankruptcy? Can an illegal immigrant file for bankruptcy?
Filing for bankruptcy can be a good option to discharge the debts that you have incurred in the process of obtaining citizenship. With more than 30 years of experience in bankruptcy matters, our New York bankruptcy law firm has all the answers. If you need legal support, do not hesitate to contact our team of professionals today.
So, do you really have to be a citizen to file for bankruptcy in 2022?
The short answer is no, you can file for bankruptcy even if you are not a US citizen or do not have a Green Card or visa. However, what you need is to have a social security number or an ITIN.
Therefore, if you are an undocumented immigrant, you can still file for bankruptcy. What you need to keep in mind is that in most cases you will need a social security number or an Individual Taxpayer Identification Number (ITIN) before filing your case. Another point to keep in mind is that your bankruptcy filing is a public record and therefore, consider how this could affect your immigration status.
If I am undocumented, can I have a social security number?
- If the immigrant legally enters the country with a student, tourist or some other type of authorized visa, they can obtain a social security number.
- You will still have a social security card with a social number even if you overstay the visa term becoming an unauthorized immigrant.
Bankruptcy laws for undocumented immigrants
As a general rule, as long as you have a domicile (or live in the country), own property, or have a business in the United States or a municipality, you qualify to file for bankruptcy.
In this sense, bankruptcy laws are very clear, debtors are not required to be legal residents or US citizens to apply for bankruptcy relief.
The requirement mentioned above regarding the Social Security number and ITIN is due to the fact that all debtors must prove their identity before the court. In other words, if you don’t have a social security number, you will most often have to obtain an ITIN from the IRS before filing your case.
Note: ITINs are issued regardless of immigration status and are generally used for people who are not eligible to receive a social security number. In other words, you can be an undocumented immigrant and get issued an ITIN to comply with U.S. tax laws.
Bankruptcy usually does not affect your immigration status
Although it is not a requirement to have a flawless financial record, the Department of Homeland Security considers your assets, resources and financial situation. The reality is that filing for bankruptcy does not automatically threaten your immigration status, although it is true that part of immigration law and how immigration benefits are determined is discretionary.
In case you are applying for citizenship or other government benefits, remember that:
- Filing for bankruptcy does not automatically mean that you are not financially self-sufficient. It is important to remember this point because your financial self-sufficiency can be a determining factor for approving or denying your citizenship application.
- Additionally, bankruptcy won’t disqualify you from being able to prove a good moral character. This is another of the main requirements for immigration matters. The bankruptcy declaration only becomes evidence of bad moral character accompanied by other evidence of bad moral character such as the commission of a crime, avoidance of paying domestic support obligations, tax obligations, fraud and others. An example of this could be if you deliberately run up tens of thousands of dollars in debt and later filed for Chapter 13 or Chapter 7 bankruptcy, due to:
- Avoid paying alimony to your ex-spouse using bankruptcy laws even when you had enough income to pay it;
- Paying for a destination wedding;
- Funding a lavish lifestyle.
In short, your application for citizenship cannot be denied based solely on your bankruptcy filing or because you have incurred too much debt.
Note: We have written a lot about debt issues in the United States. You can learn about whether bankruptcy clears medical debt, how to find out all your debts, consider bankruptcy vs debt consolidation and even if you can go to jail for debt. If you have been sued for debt, contact our team of financial professionals.
A scenario with bankruptcy criminal offenses
The main reason a bankruptcy can hurt your case for citizenship is if there was a crime committed.
Possible crimes in bankruptcy can be:
- Providing false financial statements;
- Lying under oath;
- Omitting essential information or assets from your bankruptcy forms that you were supposed to provide.
Simply filing for bankruptcy because you have too much debt is not a bankruptcy crime, and so is not a basis to deny an immigration petition.
The reality is that very few people are accused of bankruptcy crimes. Bankruptcy crimes are very rare and a good bankruptcy lawyer like Norma E. Ortiz from the office of Ortiz & Ortiz will make sure you don’t commit them.
Committing a bankruptcy crime is a serious offense and can carry the following punishments:
- Your bankruptcy petition could be denied and you could even face jail time;
- You could be removed from the US and barred from re-entry for many years or even life.
After filing for bankruptcy can I still sponsor someone else’s visa or citizen application?
Yes, generally you can still sponsor someone else to enter the country during and after filing for bankruptcy.
HHS Poverty Guidelines for Affidavit of Support and USCIS form I-864 bases these calculations primarily on income and bankruptcy leaves that point intact.
Note: However bankruptcy does not relieve you of the duty to support the person you are sponsoring. Even in the case where you have filed a bankruptcy you will likely have to repay benefits of the person that enters the country receiving government benefits.
Contact the law office of Ortiz & Ortiz
So to the question: Do you have to be a citizen to file for bankruptcy? The bottom line is that if you are an immigrant seeking citizenship, even if you declare bankruptcy you will still be able to achieve citizenship. What you must remember is to be honest about your financial situation and remain crime free.
If you are considering filing for bankruptcy but your immigration status is something you are concerned about, contact us today for your professional bankruptcy evaluation.