Filing bankruptcy in New York means filing a federal petition in the U.S. Bankruptcy Court for the district where you live, then using either New York’s exemptions or the federal exemptions to protect your property. A straightforward Chapter 7 case runs about four to six months from filing to discharge. For cases filed between November 1, 2025, and March 31, 2026, a single-person household earning less than $71,393 a year automatically qualifies for Chapter 7 in New York.1United States Department of Justice. Census Bureau Median Family Income By Family Size The work that decides how well your case goes, though, happens before you file.
Do You Qualify for Chapter 7
Chapter 7 wipes out most unsecured debts without a repayment plan, and to use it you have to pass the means test. Add up your gross income from all sources over the six full calendar months before you file, then multiply by two. If that annualized number is at or below the New York median for your household size, you pass.2United States Courts. Chapter 7 – Bankruptcy Basics
For cases filed between November 1, 2025, and March 31, 2026, the New York thresholds are:1United States Department of Justice. Census Bureau Median Family Income By Family Size
- 1 person: $71,393
- 2 people: $90,520
- 3 people: $112,616
- 4 people: $135,475
These numbers change twice a year, so confirm the figure in effect on your filing date with the U.S. Trustee Program before you rely on it. If you’re above the median, a second part of the test subtracts allowed living expenses and certain debt payments from your monthly income. A small enough leftover still qualifies you; too large, and the case is presumptively abusive, which usually pushes you toward Chapter 13.2United States Courts. Chapter 7 – Bankruptcy Basics
State or Federal Exemptions: A Choice New Yorkers Get
New York originally opted out of the federal bankruptcy exemptions under Debtor and Creditor Law section 282, but the legislature later added section 285, which lets debtors use the federal set instead.3New York State Senate. New York Code DCD 285 – Alternative Federal Exemptions The Eastern District of New York bankruptcy court confirms you can pick either, but you cannot mix items from both.4United States Bankruptcy Court Eastern District of New York. A Guide to Schedule C and Exemptions
Which package protects more depends on what you own. New York’s homestead exemption is much larger than the federal one, so homeowners with real equity almost always do better under state law. The federal exemptions include a more generous wildcard that can cover cash, bank balances, and other property that doesn’t fit a specific category, which usually favors renters.
What the New York Exemptions Cover
Homestead
The state homestead exemption protects equity in your primary residence, and the amount depends on your county:5New York State Senate. New York Civil Practice Law and Rules 5206 – Real Property Exemption
- $150,000 in Kings, Queens, New York, Bronx, Richmond, Nassau, Suffolk, Rockland, Westchester, and Putnam counties
- $125,000 in Dutchess, Albany, Columbia, Orange, Saratoga, and Ulster counties
- $75,000 in all other counties
Equity means the home’s value minus what you owe on the mortgage. If your equity exceeds the county limit, a Chapter 7 trustee could sell the home and pay you the exempt amount from the proceeds. Most trustees won’t move on a home unless the non-exempt equity is large enough to leave real money for creditors after the costs of sale.
Vehicle and Personal Property
You can protect up to $4,000 of equity in one motor vehicle, or $10,000 if the vehicle has been adapted for a disability.6New York State Senate. New York Code DCD 282 – Permissible Exemptions in Bankruptcy Total personal property claimed under CPLR 5205 is capped at $10,000 in aggregate.7New York State Senate. New York Debtor and Creditor Law 283 – Aggregate Individual Bankruptcy Exemption for Certain Annuities and Personal Property Retirement accounts, Social Security, veterans’ benefits, and part of any personal injury recovery are also commonly protected.
The Cash Wildcard
If you don’t claim the homestead exemption and your personal property exemptions come in under the $10,000 cap, you can exempt cash up to the lesser of $5,000 or the unused portion of that cap.7New York State Senate. New York Debtor and Creditor Law 283 – Aggregate Individual Bankruptcy Exemption for Certain Annuities and Personal Property This mostly helps renters. Claim any homestead exemption at all, and the cash wildcard disappears.
What to Do Before You File
Credit Counseling
Every individual filer must complete a credit counseling session from a U.S. Trustee-approved agency within 180 days before filing.8Office of the Law Revision Counsel. 11 U.S. Code 109 – Who May Be a Debtor It runs about an hour and is available by phone or online. The certificate goes in with your petition; without it, the court dismisses your case.
Gather Your Documents
The petition is a packet of federal forms that demands thorough financial disclosure. Pull the following together before you start filling anything out:
- Pay stubs covering the 60 days before filing
- The most recent federal and state tax returns
- A full asset inventory (bank accounts, vehicles, real estate, household goods, jewelry, electronics) with estimated current values, which becomes Schedule A/B
- A complete creditor list with mailing addresses and exact balances, which becomes Schedule E/F
Accuracy is not optional. Leave a creditor off your schedules and that debt may survive the bankruptcy. Undervalue assets and the trustee will notice, which creates a credibility problem that can sink the whole case.
Fees
The Chapter 7 filing fee totals $338. If your household income is below 150% of the federal poverty guidelines and you cannot pay even in installments, you can apply for a waiver.9Office of the Law Revision Counsel. 28 U.S. Code 1930 – Bankruptcy Fees Attorney fees for a standard New York Chapter 7 typically run $800 to $3,000 on top of the court fee, depending on complexity.
Where to File
New York has four bankruptcy districts, and you file in the one covering your home address. The Southern District covers most of New York City along with Westchester, Rockland, and the lower Hudson Valley. The Eastern District covers Brooklyn, Queens, Staten Island, and Long Island.10United States Bankruptcy Court. Eastern District of New York – United States Bankruptcy Court The Northern District takes in Albany and much of upstate; the Western District covers Buffalo, Rochester, and the surrounding counties.
Petitions can be filed electronically or in person. The moment yours is filed, an automatic stay takes effect and halts most creditor activity against you: lawsuits, wage garnishments, collection calls, and foreclosure proceedings all stop.11Office of the Law Revision Counsel. 11 U.S. Code 362 – Automatic Stay
What Happens After You File
The 341 Meeting
Between 20 and 60 days after filing, you attend a meeting of creditors, known as the 341 meeting. A trustee assigned to your case runs it and asks about your paperwork under penalty of perjury.12United States Department of Justice. Section 341 Meeting of Creditors Creditors may attend, though for typical consumer cases they usually don’t. The meeting often lasts five to ten minutes and may be held virtually. Bring government-issued photo ID and proof of your Social Security number.
Debtor Education
After filing but before discharge, you must complete a second course, a personal financial management class, from an approved provider. It’s separate from the pre-filing counseling. Skip it and the court will not grant your discharge.13Office of the Law Revision Counsel. 11 U.S. Code 727 – Discharge The class runs about two hours and can be done online. File the certificate with the court promptly; forgetting this is one of the most common reasons a case sits and stalls for no good reason.
Getting to Discharge
After the 341 meeting, creditors have 60 days to object to your discharge. If no one objects, the court usually enters the discharge order about two weeks after that window closes. Straightforward cases finish in four to six months.
What Bankruptcy Won’t Erase
Chapter 7 leaves several categories of debt intact, enforceable in full after discharge:14Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge
- Child support and alimony
- Most recent income tax debts, plus taxes on unfiled or fraudulent returns
- Student loans, unless you prove undue hardship, a standard courts rarely find met
- Debts arising from fraud, including credit run up with no intent to repay
- Criminal fines and court-ordered restitution
- Debts from willful injury to a person or their property
If most of what you owe falls into these buckets, Chapter 7 won’t give you the relief you’re hoping for. Map out which debts are dischargeable before you file.
When Chapter 13 Fits Better
If your income is too high for Chapter 7, or you’re behind on a mortgage or car loan and want to catch up, Chapter 13 lets you restructure debts into a three- to five-year repayment plan. You keep your property and pay creditors from disposable income over the plan period, and qualifying unsecured balances left at the end are discharged.15United States Courts. Chapter 7 – Bankruptcy Basics – Section: Alternatives to Chapter 7 For a homeowner behind on payments, Chapter 13 is often the way to save the house, because the plan spreads the arrears over several years while regular payments resume.
Credit Impact and Refiling
A Chapter 7 stays on your credit report for ten years from the filing date.16Consumer Financial Protection Bureau. How Long Does a Bankruptcy Appear on Credit Reports The initial score hit is severe but fades, and most people who rebuild with secured cards or small installment loans after discharge see meaningful recovery within two to three years. You can’t receive another Chapter 7 discharge until eight years after your previous Chapter 7 filing date, though you can file Chapter 13 four years after a Chapter 7 discharge.