To file a Chapter 128 case in Wisconsin, you complete a verified petition, an affidavit listing your creditors and amounts owed, and a proposed order appointing a trustee, then submit those forms with the filing fee to the Clerk of Circuit Court in the county where you live. The court appoints a trustee, issues an order stopping collection on included debts, and sets up a creditor meeting to work out a repayment plan that pays your unsecured debts in full within three years.1Wisconsin State Legislature. Wisconsin Code Chapter 128 Section 128-21 – Voluntary Proceedings by Wage Earners for Amortization of Debts
Confirm You Qualify Before You File
Chapter 128 has two statutory requirements. You must be a Wisconsin resident filing in your home county’s circuit court, and your principal source of income must be wages or salary.1Wisconsin State Legislature. Wisconsin Code Chapter 128 Section 128-21 – Voluntary Proceedings by Wage Earners for Amortization of Debts Courts have read “wages or salary” broadly enough to cover self-employment income and regular payments like Social Security, but the underlying idea holds: you need steady, predictable income.
You also need to show that while you can’t meet your current debts as they come due, you can make regular payments large enough to clear them within three years. There is no statutory dollar cap, but that three-year ceiling creates a practical one based on what your income supports. Prior bankruptcies don’t disqualify you, and there is no limit on how many times you can file Chapter 128.
Decide Which Debts to Include
Chapter 128 covers unsecured debts: credit cards, medical bills, personal loans, payday loans, past-due utility bills, and similar obligations without collateral. You choose which unsecured debts go into the plan. Any you leave out won’t get the court’s protection.
Secured debts such as car loans and mortgages generally can’t be included, because the lender’s rights in the collateral aren’t overridden by a state amortization plan. A secured creditor could agree to participate voluntarily, but that’s uncommon.
Government debts deserve extra thought. Section 128.17 addresses debts owed to federal, state, and local governments, and the Chapter 128 stay may not stop federal agencies from collecting on tax debts or defaulted federal student loans through their own administrative processes.2Wisconsin State Legislature. Wisconsin Code Chapter 128 – Creditors Actions If most of what you owe is federal taxes or student loans, talk to an attorney about whether Chapter 128 or federal bankruptcy is the better fit.
Gather Your Information and Complete the Forms
Before you touch a form, pull together your creditor list with each creditor’s name, mailing address, and the amount owed, plus your employment details, income figures, and Social Security number.
The core forms are:
- Form CV 5, the Petition to Amortize Debts. This is your formal request to the court, stating that you can’t meet current debts but can make regular payments over up to three years.
- Form CV 6, the Affidavit of Debts. A sworn list of each creditor and amount owed, which typically has to be notarized.
- Form CV 7, the Order Appointing Trustee and Enjoining Creditors. The court order naming your trustee and directing creditors to stop collecting.
Milwaukee County publishes its own versions of these forms.3Milwaukee County. Milwaukee County Circuit Court Forms for Voluntary Amortization of Debts Other counties may have local versions or use the standard Wisconsin Court System forms. Call the clerk of circuit court in your county before you file and confirm you have the right versions.
Payroll Deduction or Direct Payment
The petition asks you to choose how the trustee gets paid. With payroll deduction, your employer withholds a set amount from each paycheck and sends it to the trustee. Trustee fees are capped at 7% for wage assignment and 10% for direct payments.1Wisconsin State Legislature. Wisconsin Code Chapter 128 Section 128-21 – Voluntary Proceedings by Wage Earners for Amortization of Debts Payroll deduction is cheaper and removes the risk of a missed payment, but your employer will know about the filing. Direct payment is more private but costs more and puts the discipline on you.
Estimating Your Monthly Payment
Add up the debts you’re including. Multiply by 1.07 for payroll deduction or 1.10 for direct payment to build in the trustee fee. Divide by 36. That’s roughly your monthly payment. On $18,000 in unsecured debt with payroll deduction, that’s about $535 a month for three years. If that number isn’t affordable on your income, Chapter 128 probably won’t work.
File With the Clerk of Circuit Court
Once your forms are done and the Affidavit of Debts is notarized, file everything with the Clerk of Circuit Court in your county of residence. Most counties allow filing in person or by mail. The filing fee is set by Wisconsin Statutes section 814.62(2).1Wisconsin State Legislature. Wisconsin Code Chapter 128 Section 128-21 – Voluntary Proceedings by Wage Earners for Amortization of Debts Confirm the current amount with your clerk’s office before filing; some counties add local surcharges. Milwaukee County, for instance, adds a justice information surcharge on top of the base fee.4Wisconsin Court System. Wisconsin Circuit Court Fee, Forfeiture, Fine and Surcharge Tables
After the clerk accepts your filing, you receive a case number and the court moves on to appointing a trustee and issuing the order that halts creditor collection.
What Happens After You File
The Stay on Collection
Filing triggers a stay that blocks creditors from enforcing any execution, attachment, or garnishment on debts included in your plan. Wage garnishments stop, bank levies are blocked, and creditors can’t file new lawsuits on the covered debts while the case is open.1Wisconsin State Legislature. Wisconsin Code Chapter 128 Section 128-21 – Voluntary Proceedings by Wage Earners for Amortization of Debts The statute also pauses the statute of limitations on included debts, so creditors don’t lose their collection rights if the plan later fails.
This stay is narrower than the federal bankruptcy automatic stay. It applies only to the collection tools the statute lists and only to debts you actually included. Debts you left off the plan remain collectible, obligations like child support are unaffected, and federal agencies can generally continue administrative collection on tax debts and defaulted student loans.
The Trustee and the Creditor Meeting
The court appoints a disinterested trustee who meets with you soon after filing to compile a verified list of your creditors and the amounts you owe. The trustee then notifies every listed creditor of the claimed amount and schedules a meeting at the trustee’s office between 5 and 10 days after those notices go out.1Wisconsin State Legislature. Wisconsin Code Chapter 128 Section 128-21 – Voluntary Proceedings by Wage Earners for Amortization of Debts At the meeting, you, the trustee, and any creditors who show up discuss the proposed plan and sort out disagreements about how much is owed.
Afterward the trustee either tells the court that no workable plan exists (which leads to dismissal) or recommends a specific payment plan. Creditors can file written objections. The court sets the final payment amounts. You usually don’t have to appear in court yourself.
Making Payments and Finishing the Plan
Once the plan is approved, you make weekly or monthly payments to the trustee, who distributes the money proportionally to your creditors after taking the trustee fee and postage.1Wisconsin State Legislature. Wisconsin Code Chapter 128 Section 128-21 – Voluntary Proceedings by Wage Earners for Amortization of Debts You can pay more than the required amount to finish faster.
Interest generally stops accruing on included debts once you file. The statute doesn’t say so directly, but it is the widely accepted practice among Wisconsin courts and trustees, on the reasoning that requiring full payment within three years at fixed amounts doesn’t leave room for added interest.
Consistency is what makes or breaks a Chapter 128 case. The court can modify the plan if your finances change, but repeated missed payments can get the case dismissed. If that happens, the stay dissolves and creditors can immediately resume collection on the full balances. That’s the biggest risk of filing: you get relief up front, but if you can’t sustain the payments, you end up where you started.
When you finish the payments, the included debts are fully satisfied and the case closes.
Chapter 128 or Federal Bankruptcy?
Chapter 128 makes you repay every dollar of included debt. Chapter 7 bankruptcy can wipe out unsecured debts entirely, and Chapter 13 may require only partial repayment. If your goal is to reduce the total amount you pay, bankruptcy may be the better tool.
Chapter 128 has no means test, no debt ceilings beyond what your income can pay in three years, no credit counseling requirement, no tax record production, and generally no court appearance. Federal bankruptcy requires pre-filing credit counseling, post-filing debtor education, and extensive documentation, and Chapter 13 imposes federal debt limits. You can file Chapter 128 as often as you need; federal bankruptcy imposes waiting periods between filings.
A Chapter 128 filing shows up on your credit report but is not classified as a bankruptcy. It typically stays on your report for about seven years, compared with up to ten years for a Chapter 7 case.
Chapter 128 tends to fit people with manageable unsecured debt who can commit to three years of steady payments and want to avoid a bankruptcy on their record. If the debt load is genuinely unmanageable, federal bankruptcy may be more appropriate. Many Wisconsin attorneys handle both and can compare the options on your actual numbers.
Do You Need a Lawyer?
Nothing in the statute requires an attorney. The forms are relatively straightforward, and groups like the Milwaukee Justice Center publish step-by-step guides for people filing on their own. Still, the petition is a verified legal document, and mistakes in the creditor list or debt amounts can cause problems later. If you have a mix of secured and unsecured debts, disputes with creditors about balances, or significant income from sources other than a regular paycheck, hiring an attorney is worth considering. Attorney fees for Chapter 128 cases are generally modest compared with bankruptcy representation.