Financial Resource: Beginner Investing to Financial Independence!

Consider bankruptcy when there is no other alternative, and it is the last resort. If the debt has reached an alarming level and creditors haunt you all around, bankruptcy may be the way out. Especially, if one has tried debt consolidation, but failed to keep up to the plan.

However, should the noble act of tithing be abandoned after filing bankruptcy? The answer to this question is no. Most Americans are active members of some religious organization. It could be the church, the mosque, or some other religious institution. One can continue to tithe, provided one adheres to some rules put forth regarding the same. The amount to be given away is considered as an expense. Hence, one may show such a donation as a necessary expense when to file bankruptcy. According to the law, no one can object an individual who has filed for bankruptcy from tithing. However, one can engage in such contributions as long as the total tithing amount per month does not exceed 15 percent of the debtor’s current gross monthly income.

How to file for bankruptcy?

• Approach a bankruptcy attorney as it eases the process to a great extent.
• Complete a debt counseling program approved by the US Trustee.
• List all debts owed, including those listed in a credit report.
• Gather income and expense documentation.
• Do the calculations for the means testing.

After bankruptcy filing, the monthly budget of the debtor is prepared. At that time, one should list the tithing amount one intends to pay in the future. Sometimes, people who exceed the income limit allowed for Chapter 7 bankruptcy filing, include some expenses shown as donations to charity to reduce the total inflow. This allows them to file for a Chapter 7 bankruptcy filing instead of Chapter 13 Bankruptcy.

On the other hand, the monthly expense that one states as donation has to be given to the charitable organization, or religious institution. If it is discovered by the creditors, or the court that the money was spent on some other personal items, the court may take legal actions against the defaulter. Another important point to keep in mind is that one has to make one’s plan work after bankruptcy filing. Any commitment the debtor makes is very crucial. So, while listing the expenses, one should be honest to the attorney. Any failure in making the monthly payments later on will prove very costly to the defaulter. Tithing in church is considered as a moral obligation by many people. They can live their faith even in bankruptcy. Nonetheless, one should carefully work out a plan before taking any such pledges.

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