Chapter 7 Bankruptcy in Georgia: Qualifying, Exemptions, and Filing

Chapter 7 bankruptcy in Georgia lets you wipe out most unsecured debts, including credit cards, medical bills, and personal loans, through a court-supervised liquidation that usually finishes in about four months. You qualify if your household income falls below Georgia’s median for your family size, or if a detailed expense analysis shows you cannot afford to repay creditors. Georgia requires filers to use the state’s own property exemptions rather than the federal set, so state-specific dollar limits control how much equity you keep in your home, car, retirement accounts, and belongings.

Do You Qualify in Georgia?

The main gateway is the means test. It compares your average gross monthly income over the six full calendar months before filing against Georgia’s median income for a household your size. Fall below the median and you pass automatically. Fall above it and the test moves to your actual monthly expenses to see whether you have enough surplus to fund a Chapter 13 repayment plan instead.

For cases filed on or after April 1, 2026, the Georgia median income thresholds are:

One earner: $68,478
Household of two: $84,965
Household of three: $101,479
Household of four: $123,481

Add $11,100 for each person beyond four. The U.S. Trustee Program updates these figures periodically using Census Bureau data, so check the current table before relying on any number.¹

Social Security benefits are excluded from the means test calculation. If Social Security is your primary income, you may qualify even when your total household income looks high on paper. The trustee can still review your overall budget, and a comfortable monthly surplus can draw an abuse challenge.

Credit Counseling and Prior Filings

Within the 180 days before you file, you must complete a credit counseling session from an approved nonprofit agency. Skip it and the court will dismiss your case.² The session runs about an hour and most agencies offer it online or by phone.

If you received a Chapter 7 discharge in a prior case, you cannot get another one until eight years after that earlier case was filed. If your prior discharge came through Chapter 13, the waiting period drops to six years, with no wait at all if you paid your unsecured claims in full or paid at least 70 percent through a good-faith plan.³

Georgia’s Property Exemptions

Georgia does not allow filers to use the federal bankruptcy exemption schedule. You must use the state’s own list in O.C.G.A. § 44-13-100. These dollar limits decide how much property you keep when the trustee reviews your assets, and anything with equity above the caps is fair game for sale.

Home, Vehicle, and Personal Property

Homestead: up to $21,500 in equity in your primary residence. If one spouse holds title and both file jointly, the exemption rises to $43,000.⁴
Motor vehicles: up to $5,000 in total equity across all vehicles you own.
Household goods: up to $300 per item for furnishings, clothing, appliances, and books used by your household, with a $5,000 combined cap.
Jewelry: up to $500 in personal jewelry.
Tools of the trade: up to $1,500 in professional tools and books.
Health aids: professionally prescribed health aids for you or a dependent are fully exempt with no dollar cap.
Life insurance: any unmatured policy you own, plus up to $2,000 in accrued dividends, loan value, or cash value on a policy insuring you.

Joint filers can generally double each exemption by stacking their individual allowances. A married couple filing together could protect up to $43,000 in home equity, $10,000 in vehicle equity, and so on.

The Wildcard

Georgia offers a wildcard that protects up to $1,200 in any property of your choosing. On top of that, any unused portion of your homestead exemption (up to $10,000) rolls into the wildcard. If you rent your home and have no homestead equity to protect, you have up to $11,200 to apply toward any asset. For renters, this is often the most valuable exemption in the schedule.⁴

Retirement Accounts

Retirement savings get strong protection. Employer-sponsored plans that qualify under federal tax law, including 401(k)s, 403(b)s, and defined-benefit pensions, are shielded without a dollar limit under federal bankruptcy law.⁵ Traditional and Roth IRAs are protected up to a combined $1,711,975, and amounts rolled over from an employer plan into an IRA keep their unlimited protection.

Georgia’s own statute is narrower for IRA distributions and pension payments, protecting them only to the extent reasonably necessary for the support of the debtor and any dependent. Funds still sitting inside a tax-qualified retirement account are protected by the broader federal rule. The Georgia limitation mainly comes into play for payments already distributed from a plan.

Debts Chapter 7 Won’t Erase

Chapter 7 wipes out most unsecured debt, but several categories survive the discharge no matter what:

Child support and alimony. All domestic support obligations survive.⁶
Most student loans. Federal and private student loans are not discharged unless you prove “undue hardship” in a separate court proceeding, which is an extremely high bar.
Recent income taxes. Taxes generally survive if the return was due within the past three years, was filed late within two years of the petition, or involved fraud or evasion.⁷
Debts from fraud. Money, property, or services obtained through false pretenses or a materially false financial statement can be excepted on a creditor’s challenge.
Drunk-driving injuries. Debts for death or personal injury caused by driving while intoxicated are never dischargeable.
Government fines and penalties, including criminal fines and restitution.
Willful and malicious injury to another person or their property.
Recent luxury purchases. Charges over $500 to a single creditor for luxury goods within 90 days of filing, or cash advances over $750 within 70 days, are presumed non-dischargeable.

Older income taxes can sometimes be discharged if the return was originally due more than three years before filing, was actually filed more than two years before filing, and the tax was assessed more than 240 days before filing. All three conditions must be met, and you must have filed returns for the last four tax periods.⁷

How Filing Works in Georgia

Georgia has three federal bankruptcy districts: Northern, Middle, and Southern. You file in whichever district you lived in for the greater portion of the 180 days before your petition date. The Northern District, based in Atlanta, handles the highest volume of Georgia filings. The Middle District covers Macon, Columbus, and surrounding counties. The Southern District serves the southeastern part of the state from offices in Savannah and Augusta.

The filing fee is $338. If you cannot afford the full amount at filing, you can request an installment plan or, in cases of extreme hardship, apply for a fee waiver.⁸ Attorney fees for a straightforward individual case typically run $800 to $3,000, plus roughly $20 each for the required credit counseling and debtor education courses.

The moment your petition is filed, the automatic stay takes effect and stops most collection activity: wage garnishments, bank levies, creditor lawsuits, foreclosure, and collection calls all pause.⁹ Criminal proceedings and child support collection from non-estate property continue. If you filed and dismissed a bankruptcy case in the prior year, the new stay lasts only 30 days unless the court extends it.

The 341 Meeting and Discharge

Between 21 and 40 days after filing, you attend the 341 meeting of creditors. Despite the name, creditors rarely show up. The court-appointed trustee runs the meeting and asks you questions under oath about your income, assets, expenses, and the accuracy of your schedules. Most meetings last about ten minutes if your paperwork is in order.¹⁰ Bring a government-issued photo ID and proof of your Social Security number, such as your Social Security card, a W-2, or a pay stub showing the full number.¹¹ Showing up without proper ID gets the meeting continued or the case dismissed.

After the 341 meeting, creditors and the trustee have 60 days to object to your discharge or to challenge specific debts. You must also complete a post-filing debtor education course and file the certificate with the court. Miss that step and the court closes the case without a discharge.¹² If no objections are filed and the course is done, the court enters the discharge order about four months after the petition date.¹³

Keeping a Financed Car or Home

Most Chapter 7 cases in Georgia are “no-asset” cases, meaning the trustee finds nothing worth selling after exemptions are applied. For partially exempt property with equity above the cap, the trustee can sell it, pay you the exempt amount, and distribute the rest to creditors. The trustee can also abandon property that would cost more to sell than it would net.

Secured debts work differently from unsecured ones. The discharge eliminates your personal liability on a mortgage or car loan, but it does not remove the lender’s lien on the property. If you want to keep the car or the house, you need to stay current on the payments.

You can also sign a reaffirmation agreement, a binding contract where you voluntarily remain personally liable for the debt despite the bankruptcy. The agreement must be filed with the court before your discharge is entered.¹⁴ Reaffirmation carries real risk: if you later fall behind, the lender can repossess the property and pursue you for any remaining balance, just as if the bankruptcy never happened. If you filed without an attorney, the court must approve the agreement and find no undue hardship. You can rescind a reaffirmation up to 60 days after it is filed, or before the discharge is entered, whichever is later.

Many Georgia filers simply keep paying on the secured debt without reaffirming. The personal liability is discharged, the lender keeps its lien, and you keep the property as long as you pay. The trade-off is that most lenders will not report those payments to the credit bureaus, so the loan does nothing to rebuild your credit.

1
United States Department of Justice. Median Family Income Table – April 1, 2026
2
Office of the Law Revision Counsel. 11 USC 109 – Who May Be a Debtor
3
Office of the Law Revision Counsel. 11 USC 727 – Discharge
4
Justia. Georgia Code 44-13-100 – Exemptions for Purposes of Bankruptcy and Intestate Insolvent Estates
5
Office of the Law Revision Counsel. 11 USC 522 – Exemptions
6
Office of the Law Revision Counsel. 11 USC 523 – Exceptions to Discharge
7
Internal Revenue Service. Declaring Bankruptcy
8
United States Courts. Bankruptcy Court Miscellaneous Fee Schedule
9
Office of the Law Revision Counsel. 11 USC 362 – Automatic Stay
10
United States Department of Justice. Section 341 Meeting of Creditors
11
United States Department of Justice. Proof of Identification and Social Security Number Required at 341(a) Meeting of Creditors
12
United States Courts. Credit Counseling and Debtor Education Courses
13
United States Courts. Discharge in Bankruptcy – Bankruptcy Basics
14
Office of the Law Revision Counsel. 11 USC 524 – Effect of Discharge