Filing for bankruptcy is not an action that anyone takes lightly. This is especially true for immigrants who, among other things, are worried how a bankruptcy filing may impact their future paths to citizenship. So, how does bankruptcy affect immigration?
Can an Undocumented Immigrant File for Bankruptcy?
Yes, undocumented U.S. immigrants can file for bankruptcy. But they can usually only do so if they have either an Individual Taxpayer Identification Number (ITIN) or a social security number. You may find it surprising that American bankruptcy laws don’t require you to be a legal U.S. citizen. To be eligible for bankruptcy, you usually only need to live somewhere in the United States or have a business here.
If you’re an undocumented immigrant and are considering filing for bankruptcy, it’s important to keep in mind you must be able to prove your identity in order to appear before a court. This, as we mentioned, means that you’ll need to have either a social security card or a TIN prior to filing your case.
What Is An Individual Taxpayer Identification Number (ITIN)?
An ITIN, or Individual Taxpayer Identification Number, is a tax processing number only available for certain nonresident and resident aliens, their spouses, and dependents who cannot get a Social Security Number. It is a nine-digit number, beginning with the number “9,” formatted like an SSN (NNN-NN-NNNN).
To get an ITIN, you’ll need to fill out an IRS Form W-7, IRS Application for Individual Taxpayer Identification Number which requires documentation to substantiate foreign/alien status, as well as to verify your true identity. You can mail the documentation, along with the Form W-7, to the address shown in the Form W-7 Instructions, present it at IRS walk-in offices, or process your application through an Acceptance Agent authorized by the IRS.
Form W-7(SP), Solicitud de Número de Identificación Personal del Contribuyente del Servicio de Impuestos Internos is available for use by Spanish speakers.
Acceptable Acceptance Agents
Acceptance Agents are governmental organizations and commercial enterprises like colleges, accounting firms, and financial institutions that the IRS authorizes to assist applicants in obtaining ITINs. These institutions will help review an immigrant’s documentation and forward the completed Form W-7 to the IRS for processing.
Bankruptcy And Immigration
Now that we’ve established that undocumented immigrants can indeed file for bankruptcy, the question becomes can filing for bankruptcy affect your immigration status? The answer to this is yes, it can. The main way is that one of the requirements of becoming a U.S. citizens involves having “good moral character.”
The ‘good moral character’ requirement allows for immigration case agents to look at the larger picture of your life to try and determine the underlying reason for your filing for bankruptcy and to ensure that you are not going to be a “troublemaker” or in any way a drain on American society. Bankruptcies that could be used as examples of having bad more character, and therefore, negatively impact your chances at citizenship include: lavish spending, and filling for bankruptcy to avoid things like alimony and or child-support payments.
If you’re considering filing for bankruptcy but are concerned about how it may affect your immigration status, contact the Law Offices of Patrick L. Cordero for a free consultation today at (305) 445-4855.