Downtown Honolulu, Hawaii
841 Bishop Suite 2221
Honolulu, HI 96813

Can You File for Bankruptcy If You're Self-Employed? June 1, 2019

Downtown Honolulu, Honolulu
Can You File for Bankruptcy If You're Self-Employed?, Honolulu, Hawaii

Owning a business or operating as an independent contractor often requires taking economic risks, and unfortunately, the debt sometimes incurred in the process can become overwhelming. That’s when bankruptcy is an option. Although the self-employed typically find it more difficult to file, they can seek debt relief through bankruptcy just like anyone else. If you work for yourself and are thinking about filing, here are some factors you should understand before moving forward.

Providing Proof of Income

debt reliefBefore filing for bankruptcy, you’ll need to provide proof of income for the last six months. While employees can provide paystubs to demonstrate their earnings, this isn’t an option for business owners and independent contractors.

Financial records and profit and loss statements won’t be sufficient to satisfy your income verification requirement either. You must gather additional supporting documents, such as bank statements, check stubs, tax returns, invoices and contracts, and signed statements from cash payments.

Why Accuracy Matters

As a self-employed individual, verifying your income with the bankruptcy court will take some extra effort, which can make the filing process more complicated. You must ensure your income statements are accurate since they will be used to determine your eligibility for Chapter 7 bankruptcy, for which you’ll have to pass a means test that shows you don’t earn enough to pay back your creditors.

If you plan to file for Chapter 13, the court will use your income details to decide how much of your debt needs to be repaid. Providing incorrect information, whether intentional or not, may affect your ability to obtain debt relief and can make it look like you’re attempting to commit fraud. 


If you’re self-employed and filing for bankruptcy, consult Greg Dunn, Bankruptcy and Debt Relief Attorney. He has successfully represented debtors in Honolulu, HI, for more than two decades. If you decide to file for bankruptcy, he will walk you through the process from beginning to end and ensure you have all the documentation necessary to achieve your debt relief goals. Call (808) 524-4529 to set up a consultation, or visit him online to learn more about your filing options.

Other Announcements, Events and Deals from Dunn Greg Bankruptcy Attorney
4 Tips to Help You Stick to Your Holiday Budget, Honolulu, Hawaii
When the winter holidays come around, it can be tough for even the most fiscally responsible individuals to keep their spending in check. But you can’t let yourself get swept up by more
How Bankruptcy & Mortgages Are Related, Honolulu, Hawaii
If you’ve been weighing the pros and cons of hiring a bankruptcy attorney and beginning the filing process, there are many factors to keep in mind before moving forward. One of the more
The Differences Between Priority & Non-Priority Debt in Bankruptcy, Honolulu, Hawaii
Filing for personal bankruptcy generally means wiping the slate clean when it comes to your outstanding financial balances. The legal process involves reviewing what’s defined as more
What Are Reasonable Expenses in a Chapter 7 Bankruptcy?, Honolulu, Hawaii
Chapter 7 bankruptcy gives eligible borrowers the chance to eliminate most unsecured debts, but there are certain criteria to meet. One of the most important hurdles is the means more
3 Alternatives to Bankruptcy, Honolulu, Hawaii
When your debts are overwhelming, filing for bankruptcy might seem like the only option left. While this is a valid route for many people, you may be able to avoid it by more