You’ve been struggling with money for some time, and tax time seems to be when you can make up for it. You get enough money to hold you over and to help you get a few things paid off.

This year, though, you found you won’t get as much as you expected. Receiving a couple thousand dollars back is great, but it’s not enough to make a dent in the bills that you’re behind on. You’ll be back in the same position within a month.

Consider using that tax return to get yourself out of debt with bankruptcy

One way to help yourself get out of debt and to move on with fewer debts in the future is to file for bankruptcy. There are two primary types of bankruptcy that people use as consumers. They are Chapter 7 and Chapter 13 bankruptcy. There are administrative fees, application fees and other fees to consider.

Chapter 7 and 13 bankruptcy both have a $75 administrative fee. Chapter 7 cases have $15 fees for filing a petition, notice of conversion, motion to divide a joint case, motion to convert a case or motion to reopen a case. Usually, regardless of the kind of bankruptcy you file for, the base charges for a bankruptcy will be between $300 and $400.

Why choose to file for bankruptcy instead of paying down debt with your tax return?

If you just pay down your debts with your tax return, you may find yourself in a similar situation to what you’re in now in just a month or two. It makes more sense to work to eliminate debt completely, so that you can see more of your income stay in your hands in the future. For example, if you get a $500 return, you can put that $500 toward a $3,000 credit card. However, you could also put that $500 toward the bankruptcy and hopefully have the $3,000 credit card debt completely discharged.

Bankruptcy certainly isn’t for everyone, and it’s not the perfect answer for every case. However, if you’re struggling with debt, have lost a job or are living paycheck to paycheck, it may be time to look into it. For a few hundred dollars and some time and effort, you can make a significant difference in your finances. In just a few months, you could see much better financial stability and work to maintain that in the years to come.