📅 2026 Update: Changes in US Bankruptcy Law

Since the original article was written, there have been significant updates in US bankruptcy law that affect Chapter 7, Chapter 11, and Chapter 13 processes. Changes include an increase in bankruptcy filings and new eligibility rules for small businesses. The earlier article provides detailed information on bankruptcy procedures and laws, which continues further down the page.

📈 Bankruptcy Filings Rise

From April 2025 to March 2026, total bankruptcy filings increased by 11.9%, reaching 591,850 cases. This is a notable rise from 529,080 cases in the previous year. This trend indicates that more individuals and businesses are seeking relief through bankruptcy.

💰 Chapter 11 Subchapter V Changes

In October 2026, Congress raised the debt ceiling for Subchapter V of Chapter 11 from about $3.4 million to $7.5 million. This change allows more small businesses to access streamlined Chapter 11 reorganization. It aims to help these businesses recover more easily during financial difficulties.

📄 Current Filing Fees

As of October 2026, the filing fees for bankruptcy cases are as follows:

  • Chapter 7: $338
  • Chapter 11: $1,738
  • Chapter 13: $313

These fees may change, so it's important to check the U.S. Courts website for the latest information.

🕒 Processing Times

Processing times for bankruptcy cases vary. Typically, a Chapter 7 case is completed within 3 to 6 months. Chapter 11 cases can take several months to years, depending on complexity.

Chapter 13 plans usually last 3 to 5 years.

📌 Key Changes Summary

  • 📈 Bankruptcy filings increased by 11.9% to 591,850 cases.
  • 💰 Chapter 11 Subchapter V debt ceiling raised to $7.5 million.
  • 📄 Current filing fees are $338 for Chapter 7, $1,738 for Chapter 11, and $313 for Chapter 13.
  • 🕒 Processing times vary: 3 to 6 months for Chapter 7, months to years for Chapter 11, 3 to 5 years for Chapter 13.

💡 Tips for Navigating Bankruptcy

Reviewing your situation with an attorney is important to understand your specific needs and options.

📜 Understand the Means Test

For Chapter 7, you must pass the means test. This test compares your income to your state's median. If your income is below the median, you may qualify for Chapter 7.

📊 Know Your Income Requirements

Chapter 13 requires a regular income to fund a repayment plan. Make sure your income is steady enough to manage monthly payments throughout the plan.

⏳ Keep Track of Deadlines

Each bankruptcy chapter has specific deadlines. For example, Chapter 13 requires a repayment plan within 14 days of filing. Missing deadlines can affect your case.

📝 Complete Required Forms

You must complete specific forms to file for bankruptcy. For Chapter 7, Official Forms 101 and 106 are necessary. Make sure all forms are accurate and complete to avoid delays.

🆓 Explore Free Resources

Many legal aid organizations offer free or low-cost assistance for those considering bankruptcy. Research local resources to find help that fits your needs.

🏆 Free Options Ranked by User Reviews (2026)

No national paid services met the review threshold for this topic. Instead, several free government and nonprofit resources can assist with bankruptcy-related questions.

🥇 1. U.S. Courts Website

The U.S. Courts website offers comprehensive information on bankruptcy procedures and forms. It helps guide individuals through the filing process and provides essential resources.

🥈 2. Legal Aid Organizations

Many states have nonprofit organizations that provide free or low-cost legal assistance. These organizations can help individuals understand their rights and options regarding bankruptcy.

🥉 3. U.S. Trustee Program

The U.S. Trustee Program provides resources and information for individuals considering bankruptcy. They offer guidance on the bankruptcy process and can help you understand what to expect.

🔎 Check Before You Pay

  • 🔍 Confirm the organization's legitimacy.
  • 📝 Review their services and fees.
  • 💬 Read user reviews for feedback.
  • 📅 Check their availability for consultations.

❓ Frequently Asked Questions

🤔 What is the purpose of the means test?

The means test determines eligibility for Chapter 7 bankruptcy. It compares your income to the median income in your state.

🏦 How long does a Chapter 13 plan last?

A Chapter 13 repayment plan typically lasts 3 to 5 years. The duration depends on your income and the plan's specifics.

📅 What happens if I miss a deadline?

Missing a deadline can negatively impact your bankruptcy case. It may lead to dismissal or complications in the process.

⚖️ Who can file for Chapter 11 bankruptcy?

Chapter 11 is available to individuals and businesses with debts exceeding Chapter 13 limits. It is often used for larger debts and complex cases.

📊 What forms are needed for Chapter 11?

Debtors must file Official Forms 101, 201, and 3015, along with a Chapter 11 Plan of Reorganization. Accurate completion is crucial for a smooth process.

📞 Where can I find legal assistance?

Legal aid organizations provide free or low-cost assistance. Check your state for resources available to help with bankruptcy questions.

⚖️ Recent Court Cases Related to Bankruptcy

Recent court rulings have clarified various aspects of bankruptcy law, including eligibility and procedures. These rulings can affect how individuals and businesses approach bankruptcy filings.

For more recent rulings, you can browse more rulings on the news page.

End of October 2026 Update





Depending on one's purpose, the information about bankruptcy one gathers in his or her search may be quite different in tone compared to that of other students of bankruptcy law. As noted elsewhere, people who are taking more of a utilitarian approach to bankruptcy may seek a bankruptcy guide that includes as little legal language as possible.

Meanwhile, some will need a more professional source of information about bankruptcy if they are to practice bankruptcy law as a profession, or simply to play the role of lawyer on their own behalf in the act of filing pro se. In other words, they will need access to enacted statutes and court records, at the State, district and Federal levels.

For these students of the law, the Legal Information Institute (LII), an Internet-based project of Cornell University Law School, may be quite useful in their quest to uncover pertinent information about bankruptcy. Some notes on the applications of the LII toward bankruptcy:

Learn About the Legal Information Institute

In terms of what the LII seeks to accomplish as a whole, the depth of its efforts and breadth of the information it provides users is remarkable. As one might have guessed, the LII offers more than just information about bankruptcy. Indeed, the Institute is far more comprehensive than that, containing hyperlinks to online versions of the most important documents/records in American history.

Of particular relevance to the follower of bankruptcy law is the inclusion of the United States Bankruptcy Code. Despite all this insistence on the application of details of Federal statutes and landmark Supreme Court decisions for lawyers and law school attendees, the LII tries not to lose its more casual audience members.

For one, in the lead-in to particular chapters of bankruptcy law, the LII frames the individual's larger understanding of bankruptcy with a concise explanation of bankruptcy law, namely of how it is codified and litigated today. Another meritorious tool put forth by the Institute is Wex, which essentially functions as its searchable lexicon and reference book.

As is apparent, the information about bankruptcy thus discussed is most useful for the citizen as a debtor or the individual with a future or current career in bankruptcy law. Nonetheless, as devotees of the subject know, it is not all about the debtor in liquidation and reorganization cases. Imaginably, this is well understood by the owners of the LII.

In its sections and synopses surrounding the sub-topics of solvency matters, the LII also considers the root causes of bankruptcy and other related issues, explaining the workings of consumer credit, debtor-creditor law as established by contracts, and creditors' rights in bankruptcy cases.