Filing for bankruptcy in New York runs on federal law, but New York’s own statutes decide which property you keep and whether your income lets you wipe out debts under Chapter 7. For cases filed between November 2025 and March 2026, a single-person household earning less than $71,393 per year automatically qualifies for Chapter 7 relief.1United States Department of Justice. Census Bureau Median Family Income By Family Size From the day you file, a straightforward case takes about four to six months to reach discharge.
Qualifying Under the Means Test
Chapter 7 eliminates most unsecured debts without a repayment plan, and the means test is the gate. Add your gross income from every source over the six full calendar months before filing, then multiply by two.2United States Courts. Chapter 7 – Bankruptcy Basics If that annualized figure sits at or below the New York median for your household size, you pass.
For cases filed between November 1, 2025, and March 31, 2026, the median income 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
The figures update twice a year, so check the U.S. Trustee Program’s site for the number in effect on your filing date. If your income is over the median, you move to the second half of the test, which subtracts allowed living expenses, secured debt payments, and priority obligations from your monthly income. A small enough remainder still lets you file Chapter 7. Too high, and the filing is presumptively abusive and you’ll likely be pushed to Chapter 13 instead.2United States Courts. Chapter 7 – Bankruptcy Basics
Choosing Between State and Federal Exemptions
New York filers get a choice most states don’t offer. The legislature originally opted out of the federal exemption system under Debtor and Creditor Law section 282, but later enacted section 285 to restore federal exemptions as an alternative.3New York State Senate. New York Code DCD 285 – Alternative Federal Exemptions You pick one set; mixing items from both is not allowed.4United States Bankruptcy Court Eastern District of New York. A Guide to Schedule C and Exemptions
Which set works better depends on what you own. New York’s state exemptions protect far more home equity. The federal exemptions offer a bigger wildcard that can cover cash, bank balances, and property that doesn’t fit a specific category. Renters with no home equity usually come out ahead with federal exemptions. Homeowners in a high-cost county almost always do better with state.
What New York’s Exemptions Protect
Homestead
The homestead exemption shields equity in your primary residence, with the amount set by 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 remaining counties
The limit applies to equity, not market value. If your equity exceeds the cap for your county, a Chapter 7 trustee could sell the home and pay you the exempt amount from the proceeds. In practice, most trustees pass unless the non-exempt equity would produce a meaningful distribution after sale costs.
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 Personal property exempted 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 a portion of personal injury recoveries are also protected.
Cash Wildcard
If you do not claim the homestead exemption and your personal property exemptions come in under the $10,000 aggregate cap, you can exempt cash up to the lesser of $5,000 or the remaining gap.7New York State Senate. New York Debtor and Creditor Law 283 – Aggregate Individual Bankruptcy Exemption for Certain Annuities and Personal Property A renter whose other personal property adds up to $6,000 could exempt up to $4,000 in cash. Claim any homestead exemption, however, and the cash wildcard disappears entirely.
What You Have to Do Before Filing
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 The session runs about an hour by phone or online. File the completion certificate with your petition. Skip it, and the court will dismiss your case.
Documents to Gather
Pull these together before you start the forms:
- Pay stubs covering the 60 days before your filing date
- Federal and state tax returns for the most recent year
- An inventory of assets, including bank accounts, vehicles, real estate, household goods, jewelry, and electronics, with estimated current values
- A full creditor list with mailing addresses and exact balances
Accuracy matters enormously. A creditor you leave off your schedules may hold a debt that survives bankruptcy, and undervalued assets create credibility problems that can derail the whole case.
Fees
The Chapter 7 filing fee totals $338. If your household income is under 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 Chapter 7 case in New York typically run from $800 to $3,000 on top of the court fee, depending on the complexity of your finances.
Where to File
New York has four federal bankruptcy districts, and you file in the one covering where you live. Most of New York City plus Westchester, Rockland, and the lower Hudson Valley sit in the Southern District. Brooklyn, Queens, Staten Island, and Long Island are in the Eastern District.10United States Bankruptcy Court. Eastern District of New York – United States Bankruptcy Court The Northern District covers Albany and much of upstate, and the Western District handles Buffalo, Rochester, and the surrounding region.
Petitions can be submitted electronically or in person. The moment you file, the automatic stay takes effect and stops most creditor collection activity, including lawsuits, wage garnishments, phone calls, and foreclosure proceedings.11Office of the Law Revision Counsel. 11 U.S. Code 362 – Automatic Stay For many filers this is the most immediate relief bankruptcy delivers.
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 runs it and questions you under oath about your paperwork.12United States Department of Justice. Section 341 Meeting of Creditors Creditors may attend and ask questions but rarely do in consumer cases. The meeting usually takes five to ten minutes and may be held virtually. Bring a government-issued photo ID and proof of your Social Security number.
Debtor Education Course
After filing but before discharge, you must finish a second course, a personal financial management class, from a U.S. Trustee-approved provider. This is separate from the pre-filing counseling. No completion certificate, no discharge.13Office of the Law Revision Counsel. 11 U.S. Code 727 – Discharge The course runs about two hours online. Forgetting to file the certificate is one of the most common reasons cases stall.
Discharge
After the 341 meeting, creditors have 60 days to object to your discharge. If none do, the court typically enters a discharge order within about two weeks after that window closes. Four to six months, start to finish, is the usual timeline for a straightforward Chapter 7.
Debts That Survive
Chapter 7 does not erase everything. Several categories pass through discharge intact:14Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge
- Child support and alimony pass through untouched.
- Recent income tax debts remain, along with any taxes tied to a fraudulent return or an unfiled year.
- Student loans survive unless you can prove repaying them would cause undue hardship, a standard most courts apply strictly.
- Debts from fraud, such as credit card charges run up with no intention to repay or loans obtained through false financial statements, can be challenged by creditors.
- Criminal fines and court-ordered restitution cannot be eliminated.
- Liabilities from willful injury to a person or property survive.
If a large share of what you owe sits in these categories, map out the dischargeable portion before you file. Chapter 7 may not deliver the relief you were counting on.
If Chapter 7 Doesn’t Fit
Income too high, or you need to catch up on a mortgage? Chapter 13 restructures your debts into a three- to five-year repayment plan. You keep all your property and pay creditors from disposable income over the plan period, and remaining qualifying unsecured debts are discharged at the end.15United States Courts. Chapter 7 – Bankruptcy Basics – Section: Alternatives to Chapter 7 Chapter 13 is often better when you’ve fallen behind on a mortgage and want to save your home, because the plan can spread missed payments over years while regular payments resume. The filing fee is $313, and the same credit counseling and debtor education requirements apply.
Credit Report and Refiling
A Chapter 7 bankruptcy 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 hit to your score is severe but softens over time, especially if you start rebuilding with a secured card or a small installment loan shortly after discharge. Most people see meaningful score recovery within two to three years.
If things fall apart again, you can’t get another Chapter 7 discharge until eight years after your previous Chapter 7 filing date. Chapter 13 is available sooner. The wait for a Chapter 13 after a Chapter 7 discharge is four years.