Filing for Chapter 13 bankruptcy offers individuals a valuable second chance to reorganize their finances and protect their assets while paying off debt through a structured repayment plan. But it’s not a guaranteed outcome—many Chapter 13 cases are dismissed before completion, often due to avoidable mistakes.
If you’re considering filing in Nevada or are already in a repayment plan, understanding the most common pitfalls can help you stay on track and avoid having your case dismissed.
What Is a Chapter 13 Dismissal?
A dismissal means your bankruptcy case is terminated without a discharge of your debts. When this happens, the automatic stay is lifted, and creditors can resume collections, including lawsuits, garnishments, and foreclosures. In many cases, a dismissal forces individuals back into financial crisis.
Common Mistakes That Lead to Chapter 13 Dismissals
1. Missing Plan Payments
The most common reason for dismissal is failure to make the required monthly payments to the bankruptcy trustee. If your plan payment is even a few days late and you don’t notify the court or your attorney, your case may be at risk.
How to avoid it:
Set up auto-payments or calendar reminders, and communicate immediately if your income changes or if you encounter unexpected financial hardship.
2. Failing to File Required Paperwork
Bankruptcy courts in Nevada—and across the country—require extensive documentation. This includes tax returns, pay stubs, a full list of assets and debts, and more. Missing or incomplete paperwork can lead to delays or immediate dismissal.
How to avoid it:
Work closely with your attorney to ensure all documents are complete, accurate, and submitted on time.
3. Not Attending the 341 Meeting (Meeting of Creditors)
You are required to attend a 341 meeting after filing. If you fail to show up or do not bring the necessary identification and documents, your case can be dismissed.
How to avoid it:
Mark your calendar and prepare for the meeting. Bring photo ID, Social Security card, and any documents your trustee requests.
4. Failing to Propose a Feasible Plan
If your repayment plan is unrealistic—either underpaying creditors or relying on income you don’t consistently earn—the court may reject or later dismiss your case.
How to avoid it:
Create your plan with a bankruptcy attorney who understands local trustee expectations and ensures it’s based on your real income and expenses.
5. Incurring New Debt Without Permission
Taking out new loans or using credit cards during a Chapter 13 case (without court approval) is a serious violation. It can cause your case to be dismissed or converted to Chapter 7.
How to avoid it:
Consult your attorney before taking on any new financial obligations during your case.
6. Failing to File Tax Returns During the Case
Even after your case is filed, you must stay current on your tax filings. Failing to file returns during the plan period is grounds for dismissal.
How to avoid it:
Continue filing your taxes every year and provide copies to the trustee if requested.
7. Job Loss or Major Life Changes Without Informing the Court
Losing your job, getting divorced, or having a child can all impact your ability to meet your repayment plan. If you don’t notify the court, your case may be dismissed when payments lapse.
How to avoid it:
Inform your attorney of any major changes as soon as possible. Your plan may be modified to accommodate new circumstances.
Why Dismissal Is a Big Deal
A dismissed Chapter 13 case means:
- You lose bankruptcy protections (like the automatic stay)
- Creditors can resume collections
- Foreclosures or repossessions may continue
- You may have difficulty refiling right away, depending on your case
Avoiding dismissal isn’t just about following rules—it’s about giving yourself the best chance at a fresh financial start.
Final Thoughts
Chapter 13 bankruptcy is a powerful financial tool—but only if you avoid the common mistakes that can derail your case. Staying organized, proactive, and in close communication with your bankruptcy attorney is key to completing your repayment plan and achieving debt relief.
At DeLuca & Associates Bankruptcy Law, we help Nevada residents navigate the Chapter 13 process from start to finish. Our team is here to guide you, ensure compliance, and adjust your plan when life changes. Contact us today for personalized advice and experienced legal support to avoid the pitfalls of dismissal and protect your financial future.
Business Name – DeLuca & Associates Bankruptcy Law
Phone Number: (702) 252-4673
Website: https://www.deluca-associates.com/
Address: 4560 S. Decatur Blvd. Suite 302, Las Vegas, NV 89103