I recently discussed involuntary dismissals of Chapter 7 petitions under 11 U.S.C. § 707(b) where the Court determines that a presumption of abuse exists. If faced with an inevitable dismissal under 11 U.S.C.§ 707(b), a debtor can convert to a Chapter 13 bankruptcy. See 11 U.S.C.§ 706. This requires the debtor to file a petition to convert to a Chapter 13 or entry of a stipulated order with the bankruptcy Trustee. If successful, the conversion eliminates the threat of an involuntary dismissal under 11 U.S.C.§ 707(b). The downside to such a conversion is that the debtor no longer has the right to voluntarily convert the case back to a Chapter 7. The option of a voluntary dismissal of the petition is also eliminated. Once converted to a Chapter 13 bankruptcy, a dismissal can only be obtained by filing a motion with the court. 11 U.S.C.§ 1307(b). Consequently, knowledge of the bankruptcy petition and the means test is critical when seeking bankruptcy protection. It may be possible to delay filing a petition by a few weeks or months and avoid the hassle of triggering the presumption of abuse provision.

- Richard V. Stokan, Jr.