To file bankruptcy in Arkansas, you choose between Chapter 7 and Chapter 13, complete a required credit counseling session within 180 days before filing, prepare a petition detailing your assets, debts, income, and expenses, select either the Arkansas or federal exemption set, and submit everything to the U.S. Bankruptcy Court for either the Eastern or Western District of Arkansas with a filing fee of $338 (Chapter 7) or $313 (Chapter 13). A trustee is assigned, you attend a meeting of creditors about a month later, finish a second financial education course, and receive your discharge. The sections below walk through each step and what it costs.
Step 1: Choose Chapter 7 or Chapter 13
Chapter 7 is a liquidation case. A trustee reviews your assets, sells anything an exemption doesn’t protect, pays creditors from the proceeds, and most remaining unsecured debts are wiped out. The case usually finishes in about four months.
Chapter 13 is a reorganization. You keep your property and commit to a three- to five-year repayment plan funded by your disposable income. If your household income is below the Arkansas median, the minimum plan length is three years; if it meets or exceeds the median, the plan runs at least five years.1Office of the Law Revision Counsel. 11 U.S. Code 1325 – Confirmation of Plan Remaining unsecured balances are generally discharged at the end.
Chapter 13 is often the right choice when you’re behind on a mortgage or car loan and need time to catch up, or when you own nonexempt property a Chapter 7 trustee would otherwise sell. Chapter 7 fits people with limited income, few nonexempt assets, and mostly unsecured debts like credit cards and medical bills.
Chapter 13 has a debt ceiling. For cases filed between April 1, 2025 and March 31, 2028, your secured debts cannot exceed $1,580,125 and your unsecured debts cannot exceed $526,700. Above those caps, Chapter 13 is unavailable.
Step 2: Check Whether You Qualify for Chapter 7
Chapter 7 is screened by a means test that compares your household income to the Arkansas median for a household your size. The figures used for cases filed in 2026 (effective November 1, 2025) are:2U.S. Trustee Program/Dept. of Justice. Census Bureau Median Family Income By Family Size
- One earner: $56,923
- Two people: $71,742
- Three people: $80,218
- Four people: $94,566
- Each additional person: add $11,100
If your income is below the applicable number, you pass and can file Chapter 7. If it’s above, a second calculation applies: the court subtracts IRS-approved living expenses from your income and multiplies the remainder by 60 months. If that number is high enough to repay a meaningful portion of your unsecured debt, the court presumes abuse and will likely push you into Chapter 13.3Office of the Law Revision Counsel. 11 U.S. Code 707 – Dismissal of a Case or Conversion to a Case Under Chapter 11 or 13 The calculation is done on Form B122A for Chapter 7 or B122C for Chapter 13.
Step 3: Complete Credit Counseling Before You File
You must complete a credit counseling briefing from a nonprofit agency approved by the U.S. Trustee’s Office for your Arkansas judicial district. The session has to happen within 180 days before you file.4Office of the Law Revision Counsel. 11 U.S.C. 109 – Who May Be a Debtor It can be done by phone, online, or in person, and typically costs around $50, with fee waivers available if you cannot afford it.
The briefing reviews your budget, outlines alternatives, and confirms you understand what filing means. You receive a certificate that must be filed with your petition. If you skip the session or let the 180-day window lapse, the court will dismiss your case. Narrow exceptions exist for people with disabilities, those on active duty in a combat zone, and districts where approved agencies cannot meet demand.
Step 4: Pick Your Exemptions — State or Federal
Exemptions decide which property you keep. Arkansas is one of the states that lets filers choose between the federal set under 11 U.S.C. § 522(d) and the state exemptions from the Arkansas Constitution and state statutes.5Justia. Arkansas Code 16-66-217 – Election of Bankruptcy Exemptions You pick one set for the whole case; mixing is not allowed.6Office of the Law Revision Counsel. 11 U.S.C. 522 – Exemptions
Federal Exemptions (Adjusted April 1, 2025)
- Homestead: up to $31,575 in equity in your primary residence
- Motor vehicle: up to $5,025 in one vehicle
- Household goods: up to $800 per item, $16,850 total
- Jewelry: up to $2,125
- Tools of your trade: up to $3,175
- Wildcard: up to $1,675 in any property, plus up to $15,800 of any unused homestead exemption
The wildcard is especially useful for renters, who can apply the unused homestead portion to cash, tax refunds, a more valuable vehicle, or other assets.7Federal Register. Adjustment of Certain Dollar Amounts Applicable to Bankruptcy Cases
Arkansas State Exemptions
Under Arkansas Code § 16-66-210, a rural homestead can cover up to 160 acres (minimum 80 acres regardless of value) and an urban homestead up to one acre (minimum one-quarter acre regardless of value), both capped at $2,500 in value above the protected minimum acreage.8Justia. Arkansas Code 16-66-210 – Homestead Exemption
Personal property allowances under § 16-66-218 are modest: $200 for an unmarried filer (beyond clothing), $500 for a married person or head of household, $1,200 for one motor vehicle, and $750 for tools of your trade.9Justia. Arkansas Code 16-66-218 – Exemptions From Execution Under Federal Bankruptcy Proceedings
Which Set Fits Your Situation
If you own rural acreage, the Arkansas homestead can shelter land the federal cap could not. For most other filers, the federal set is more generous across the board: $31,575 in home equity protection against the state’s $2,500 value cap, higher personal property limits, and a wildcard that gives renters a flexible cushion state law doesn’t offer. Run the numbers both ways before you commit.
Step 5: Prepare the Petition and Schedules
The paperwork is the most time-consuming part. Download the official forms from the U.S. Courts site, beginning with the Voluntary Petition (Form B101).10U.S. Courts. Voluntary Petition for Individuals Filing for Bankruptcy The schedules require a complete accounting:
- Schedules A/B through J: every asset, every secured and unsecured debt, your income, and your monthly expenses
- Statement of Financial Affairs (Form B107): recent property transfers, payments to creditors, lawsuits, and income sources from the prior two years
- Means Test (Form B122A or B122C): the income calculation that determines Chapter 7 eligibility or sets your Chapter 13 payment
Pull together your tax returns, pay stubs, bank statements, loan documents, and vehicle titles before you start filling anything out. List every creditor, including family members and disputed debts; leaving one off can prevent that debt from being discharged. Attach your credit counseling certificate. Inaccurate forms cause delays, and omitting assets can be treated as fraud.
Step 6: File in the Right Arkansas District
Arkansas has two federal judicial districts. The Eastern District sits in Little Rock; the Western District operates from locations including Fort Smith and Fayetteville. File in whichever district you’ve lived in for the greater part of the 180 days before filing.11Office of the Law Revision Counsel. 28 U.S.C. 1408 – Venue of Cases Under Title 11
Attorneys file electronically through CM/ECF. Pro se filers submit paperwork in person or by mail to the appropriate clerk’s office. Fees are $338 for Chapter 7 and $313 for Chapter 13. You can apply for an installment plan to spread the payment out. In Chapter 7, filers whose income is below 150 percent of the federal poverty guidelines may request a full fee waiver.
Step 7: The Automatic Stay Kicks In
Once the clerk assigns a case number, the automatic stay takes effect immediately and forces creditors to stop almost all collection activity. Lawsuits, wage garnishments, foreclosures, repossessions, and collection calls all halt.12Office of the Law Revision Counsel. 11 U.S. Code 362 – Automatic Stay
The stay does not cover everything. Criminal proceedings continue. Child support and alimony can still be collected, and family court actions for paternity, custody, or divorce (other than property division) proceed normally. If a landlord already had a judgment for possession before you filed, the eviction can still move forward.
Step 8: Attend the Meeting of Creditors
About a month after filing, you attend the meeting of creditors (the 341 meeting) run by the trustee assigned to your case.13Office of the Law Revision Counsel. 11 U.S.C. 341 – Meetings of Creditors and Equity Security Holders At least seven days before the meeting, provide the trustee with a copy of your most recent federal tax return.14Office of the Law Revision Counsel. 11 U.S.C. 521 – Debtor’s Duties Bring a government-issued photo ID and proof of your Social Security number. You also have to supply pay stubs covering the 60 days before you filed.
The trustee puts you under oath and asks about your assets, debts, income, and the accuracy of your schedules. Creditors are invited but rarely attend routine consumer cases. No judge is present. If your paperwork is in order, the meeting usually lasts under ten minutes.
Step 9: Finish Debtor Education and Get Your Discharge
After the 341 meeting, complete a second financial course called debtor education. This is separate from pre-filing credit counseling and covers budgeting, money management, and credit use. Use a provider approved for your district; most people finish online in about two hours, and the fee is typically around $50.
Skip this course and you won’t get a discharge in Chapter 7,15Office of the Law Revision Counsel. 11 U.S.C. 727 – Discharge and the same rule applies in Chapter 13.16Office of the Law Revision Counsel. 11 U.S.C. 1328 – Discharge Without the certificate, your case can close without your debts being wiped out.
In Chapter 7, the discharge order usually arrives about 60 days after the 341 meeting, roughly four months from filing. In Chapter 13, discharge comes after you complete all plan payments across three to five years. Fall behind on plan payments and the court can dismiss your case or convert it to Chapter 7, in which case the trustee could sell nonexempt assets you had been keeping.17United States Courts. Chapter 13 – Bankruptcy Basics
Debts That Won’t Go Away
Some obligations survive bankruptcy regardless of chapter:18Office of the Law Revision Counsel. 11 U.S. Code 523 – Exceptions to Discharge
- Child support and alimony
- Most student loans (dischargeable only on proof of undue hardship in a separate proceeding, a high bar in most jurisdictions)
- Recent income taxes, unless the return was due more than three years ago, was filed more than two years ago, and the tax was assessed more than 240 days before filing19Internal Revenue Service. Publication 908, Bankruptcy Tax Guide
- Debts obtained through fraud or false financial statements
- Debts arising from driving while intoxicated
- Consumer debts over $500 for luxury goods charged within 90 days of filing, and cash advances over $750 taken within 70 days, which are presumed nondischargeable
Tax rules are the trickiest. A fraudulent or unfiled return produces a permanently nondischargeable tax debt, and honest tax debts must meet all three timing tests at once. A bankruptcy attorney or tax professional can map your specific years against the deadlines.
What It All Costs
Court filing fees are $338 for Chapter 7 and $313 for Chapter 13. The two required courses typically run about $50 each, with waivers available for low-income filers.
Attorney fees for a straightforward Chapter 7 case generally fall between $1,000 and $3,000. Chapter 13 cases run higher because of ongoing plan administration, commonly $2,500 to $5,000, and the fees are often folded into the repayment plan rather than paid upfront. Asset disputes, business debts, and other complications push fees toward the higher end.
You can file without an attorney, but pro se filers often make exemption mistakes, miss deadlines, and lose property they could have protected. If cost is the obstacle, the installment option and the Chapter 7 fee waiver for low-income filers can ease the immediate burden.