Filing Chapter 7 Bankruptcy: A 50-State Guide (2026)
Reviewed by DocDraft Legal Team · United States · Last updated August 18, 2026
Chapter 7 bankruptcy is a federal liquidation process governed by the Bankruptcy Code at 11 U.S.C. 701 and following. It lets qualifying individuals discharge most unsecured debt, such as credit cards and medical bills, in a few months. To qualify you generally pass a means test that compares your income to your state's median family income under 11 U.S.C. 707(b). What property you keep depends on exemptions, and while the exemption concept is federal, the actual dollar figures are set state by state under 11 U.S.C. 522. This national guide explains the federal framework, and it links to a page for each of the 50 states. Chapter 7 does not discharge most student loans, recent income taxes, child support, or spousal support.
What is Chapter 7 bankruptcy?
Chapter 7 is the federal liquidation form of bankruptcy under 11 U.S.C. 701 and following. A trustee can sell any non-exempt property to pay creditors, and in exchange the court discharges most unsecured debts like credit cards and medical bills. Most individual cases involve little or no property loss and close in a few months.
Who qualifies to file Chapter 7?
You generally must pass the means test under 11 U.S.C. 707(b). If your household income is at or below your state's median family income for your household size, you pass automatically. If it is higher, a second calculation of disposable income decides whether you qualify or are steered toward Chapter 13 instead.
What property can you keep in Chapter 7?
You keep property covered by exemptions. Exemptions are federal in concept under 11 U.S.C. 522 but set state by state in amount. Some states force you to use their own exemption list, while about 16 choice states let you pick the federal 522(d) set or the state set. Your state's homestead exemption often decides whether you keep your home.
What debts does Chapter 7 not discharge?
Chapter 7 wipes out most credit card debt, medical bills, and personal loans. It does not discharge most student loans, recent income taxes, child support, or spousal support, and it will not erase debts from fraud. Secured debts like a mortgage or car loan survive unless you surrender the collateral or reaffirm the loan.
How Chapter 7 Exemptions Vary by State
Chapter 7 itself is uniform federal law, but the exemptions that decide what property you keep are where the states diverge, and that difference can determine whether you keep your house. Under 11 U.S.C. 522(b)(2) a state may bar its residents from using the federal 522(d) exemption list. Opt-out states force debtors onto the state exemption set only. About 16 choice states let a debtor elect either the federal 522(d) set or the state set, whichever protects more. The homestead exemption shows the widest spread: a handful of states, including Florida and Texas, protect unlimited home equity within an acreage cap, while many states cap the homestead at a fixed dollar amount that can range from generous to very modest, and a few protect only a small figure. Motor vehicle, wildcard, personal property, wage, and retirement exemptions vary just as much. Because these figures change the outcome of a case, this guide includes a dedicated page for each of the 50 states with that state's opt-out status, homestead and vehicle figures, means-test median income, and the federal bankruptcy district court where residents file. Use the federal steps below, then open your state's page for the exemption numbers that apply to you.
Relevant Laws
Chapter 7 Liquidation (11 U.S.C. 701 and following)
The chapter of the federal Bankruptcy Code that governs liquidation bankruptcy. It provides for appointment of a trustee, collection and sale of non-exempt property, and distribution to creditors, and it is the framework under which most individual consumer bankruptcy cases are filed.
Exemptions and State Opt-Out (11 U.S.C. 522)
Sets the federal exemption list in subsection (d) and, in subsection (b)(2), lets a state bar its residents from using that federal list. This is the provision that makes exemption figures vary so widely from state to state and creates the opt-out versus choice distinction.
The Means Test (11 U.S.C. 707(b))
Establishes the means test that compares a debtor's current monthly income against the median family income for the applicable state. Filers at or below the state median pass automatically; those above it face a disposable-income calculation that can require Chapter 13 instead.
Discharge (11 U.S.C. 727)
Governs the Chapter 7 discharge that releases the debtor from personal liability for most pre-filing debts. It also lists grounds for denying a discharge, such as concealing assets or failing to complete the required financial management course.
Regional Variances
Homestead and Exemption Approach by State Type
Unlimited-homestead states
A small group of states protects unlimited home equity, subject to an acreage or lot-size cap rather than a dollar cap. Florida and Texas are the best-known examples. In these states a filer with substantial home equity can often keep the house in Chapter 7, though a federal cap can limit protection for equity acquired shortly before filing. See your state page for the acreage limits and the cite.
Opt-out states
Under 11 U.S.C. 522(b)(2), most states have opted out of the federal 522(d) exemption list, so residents must use the state exemption set only. The homestead, vehicle, and wildcard figures in these states are fixed by state statute and range from generous to modest. Your state page identifies the opt-out statute and lists the current amounts.
Choice states
About 16 states let a debtor elect either the federal 522(d) exemptions or the state exemptions, whichever protects more property. This choice can matter a great deal for renters and low-equity filers, who may prefer the portable federal wildcard, versus homeowners, who may prefer a larger state homestead. Check your state page to confirm choice status and compare the two sets.
Suggested Compliance Checklist
Complete the pre-filing credit counseling course
Within 180 days before filing days after startingTake an approved credit counseling course from a provider authorized by the U.S. Trustee Program for your federal district and keep the certificate. You must file it with your petition. Skipping this step can get your case dismissed before your debts are addressed.
Confirm your state means-test median income
Before you file days after startingCheck your household size against the U.S. Trustee median family income figures for your state in effect on your filing date, since these update periodically. The current figures are effective for cases filed on or after July 15, 2026. Your state page carries the exact numbers for household sizes one through four plus the per-person increment.
Prepare and file your petition and schedules
Filing day days after startingFile your petition, schedules, and exemption claims in the correct federal bankruptcy court for your district, based on where you have lived for most of the prior 180 days. Filing triggers the automatic stay under 11 U.S.C. 362 that pauses most collection and wage garnishment.
Attend the 341 meeting of creditors
About one month after filing days after startingAttend the 341 meeting of creditors and answer the trustee's questions under oath about your income, property, and debts. Bring photo identification and proof of your Social Security number. Honest, complete answers protect your discharge under 11 U.S.C. 727.
Complete the financial management course before discharge
Before discharge days after startingComplete the required post-filing financial management course from an approved provider and file the certificate before the court will grant your discharge. Once the objection window closes, the court enters the discharge order eliminating personal liability for most pre-filing debts. An attorney can help with contested exemptions.
| Task | Description | Document | Days after starting |
|---|---|---|---|
| Complete the pre-filing credit counseling course | Take an approved credit counseling course from a provider authorized by the U.S. Trustee Program for your federal district and keep the certificate. You must file it with your petition. Skipping this step can get your case dismissed before your debts are addressed. | - | Within 180 days before filing |
| Confirm your state means-test median income | Check your household size against the U.S. Trustee median family income figures for your state in effect on your filing date, since these update periodically. The current figures are effective for cases filed on or after July 15, 2026. Your state page carries the exact numbers for household sizes one through four plus the per-person increment. | - | Before you file |
| Prepare and file your petition and schedules | File your petition, schedules, and exemption claims in the correct federal bankruptcy court for your district, based on where you have lived for most of the prior 180 days. Filing triggers the automatic stay under 11 U.S.C. 362 that pauses most collection and wage garnishment. | - | Filing day |
| Attend the 341 meeting of creditors | Attend the 341 meeting of creditors and answer the trustee's questions under oath about your income, property, and debts. Bring photo identification and proof of your Social Security number. Honest, complete answers protect your discharge under 11 U.S.C. 727. | - | About one month after filing |
| Complete the financial management course before discharge | Complete the required post-filing financial management course from an approved provider and file the certificate before the court will grant your discharge. Once the objection window closes, the court enters the discharge order eliminating personal liability for most pre-filing debts. An attorney can help with contested exemptions. | - | Before discharge |
Frequently Asked Questions
A typical individual Chapter 7 case takes about four to six months from filing to discharge. You file the petition, attend the 341 meeting of creditors roughly a month later, complete the financial management course, and the court enters the discharge after the objection period closes. Complex cases with non-exempt assets or disputes can take longer.
Chapter 7 is liquidation: it discharges most unsecured debt quickly, in a few months, with no repayment plan. Chapter 13 is a three-to-five-year repayment plan that lets you keep non-exempt property and catch up on secured debts like a mortgage. If your income is above the 11 U.S.C. 707(b) means-test threshold, you may be steered to Chapter 13.
Usually yes. Filing triggers the automatic stay under 11 U.S.C. 362, which immediately halts most collection actions, including wage garnishment, bank levies, and collection calls, the moment your petition is filed. The stay does not stop garnishment for domestic support obligations like child support, and some other narrow exceptions apply.
No. Most individual filers keep all or nearly all of their property because exemptions protect it. Exemptions are set state by state under 11 U.S.C. 522, and many states also protect a home under a homestead exemption. Check your state's page for the exact figures, since equity above the exemption limits can be reachable by the trustee.
A Chapter 7 bankruptcy can remain on your credit report for up to 10 years from the filing date under the federal Fair Credit Reporting Act. Its impact usually fades over time, and many people begin rebuilding credit within a year or two of discharge by paying new obligations on time and keeping balances low.
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