Bankruptcy in Pennsylvania
If you’re a Pennsylvania resident facing financial pressure, it may feel like there’s no way out. The stress can wear you down quickly, especially when every paycheck seems to disappear before the month is over.
Bankruptcy may be the reset you need to rebuild your finances. Filing for bankruptcy in Pennsylvania can stop garnishments, halt foreclosures, and discharge many types of debt.
But the process isn’t one-size-fits-all, and Pennsylvania has its own rules. Without the right guidance, you could miss out on key protections or file under the wrong chapter entirely.
We connect Pennsylvania residents with experienced bankruptcy attorneys who know how to protect your interests. If you’re ready to break free from debt and reclaim your future, we’re here to help you take the first step.
Types of Bankruptcy in , Pennsylvania
Bankruptcy is a legal remedy designed to help individuals and businesses regain control when debts have become unmanageable. By filing, you may be able to eliminate some or all of what you owe, giving you a clean slate and a path toward financial stability.
If you’re considering bankruptcy, you’ll need to figure out which type fits your situation. Chapter 7, Chapter 11, and Chapter 13 each have different requirements and outcomes. Your income level and the assets you want to keep will all play a role in deciding which chapter makes the most sense.
In Pennsylvania, bankruptcy cases are handled by the U.S. Bankruptcy Courts, which are divided into three districts: Eastern, Middle, and Western. Each district serves specific counties and has designated courthouses where bankruptcy proceedings are conducted.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is often the go-to option for people who need to wipe the slate clean and make a fresh start. It can be a powerful tool for eliminating unsecured debt, but it’s not the right fit for everyone. Before filing, take time to evaluate your income, obligations, and financial outlook.
Most people who qualify for Chapter 7 have little to no disposable income or have gone through a financial setback. While this chapter can erase unsecured debts, it may also require you to give up certain non-exempt property. Once your case is filed, the court issues an automatic stay, which temporarily stops most collection actions.
In Pennsylvania, qualifying for Chapter 7 involves passing a means test that compares your income to the state’s median. In 2025, the median annual income thresholds are:
- 1-person household: $67,676
- 2-person household: $83,249
- 3-person household: $103,856
- 4-person household: $125,754
- For households larger than four, add $11,100 for each additional member.
Chapter 11 Bankruptcy
Chapter 11 bankruptcy tends to be more involved than others. It’s primarily used by businesses or individuals with complex financial situations or high-value assets.
Instead of selling off property to pay back creditors, Chapter 11 focuses on reorganizing debts into a manageable repayment plan. That plan often spans four to 18 months and is tailored to your financial capacity. You can also usually hold on to your assets while negotiating new terms with creditors.
Filing for Chapter 11 bankruptcy requires full transparency about your financial situation. You’ll need to disclose all assets, debts, income, and expenses, and submit a formal reorganization plan.
Here are the core forms required in a Chapter 11 filing:
- Voluntary Petition for Individuals Filing for Bankruptcy (Form B101)
- Schedules A/B through J (detailing your property, liabilities, income, and expenses)
- Summary of Assets and Liabilities (Form B106)
- Statement of Financial Affairs (Form B107)
- Chapter 11 Statement of Current Monthly Income (Form B122B)
- List of all creditors and their contact information (Creditor Matrix)
- Schedule of Executory Contracts and Unexpired Leases (Form B106G)
- Proposed Disclosure Statement and Chapter 11 Reorganization Plan
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is often called a wage earner’s plan because it’s built for people with regular income. In PA, once you file your petition, the court appoints a trustee to review your income, debts, and assets.
Unlike Chapter 7, you won’t be liquidating your property—instead, you’ll propose a repayment schedule that usually lasts three to five years. How flexible that plan is will depend on the consistency of your income and assets. If you complete the plan, some or even most of your remaining unsecured debt may be discharged.
The Bankruptcy Process in , Pennsylvania
Timing a bankruptcy filing is never easy. However, if it looks like there’s no way you’ll pay off your debts within five years, continuing to struggle may do more harm than good. Filing for bankruptcy can stop the financial bleeding and put you on a path toward stability.
In Pennsylvania, the process starts with pulling together a full set of financial documents. That means collecting detailed records of your income, debt balances, monthly expenses, and assets. The court relies on this information to evaluate your case, so accuracy is critical.
Filing for bankruptcy in Pennsylvania involves navigating both federal procedures and state-specific laws. Pennsylvania allows filers to choose between state and federal exemption lists, but you must select one set.
Choosing the right exemption set is crucial to safeguarding your assets and achieving a fresh financial start. Pennsylvania offers the following in 2025:
- Personal Property:
- Wearing apparel
- Bibles and school books
- Military uniforms and accoutrements
- Sewing machines
- Wildcard: $300 of any property, including cash, real property, and securities.
- Retirement Accounts: Pensions for city employees, municipal employees, police officers, public school employees, and state employees are exempt.
- Public Benefits: Exempts various public assistance benefits, including Social Security, unemployment compensation, workers’ compensation, and veterans’ benefits.
Work With an Experienced , Pennsylvania Lawyer
If you live in Pennsylvania and feel like your debt has taken over your life, bankruptcy may be the turning point you need. Whether you’re considering Chapter 7 to wipe out debt or Chapter 13 to reorganize what you owe, filing can give you space to breathe.
Submit a request online or call us today at (866) 345-6784 to get in touch with an experienced lawyer in your area!
About the Author
Aaron is a professional legal writer with a B.S. in English Education from Southern Illinois University – Carbondale. He has written, published, and edited thousands of legal articles for RequestLegalHelp, which has connected over 5 million people to legal help in the United States.
With over five years of experience writing thousands of legal articles for law firms across the U.S. and Canada, Aaron specializes in covering federal, state, and city-level legal issues ranging from auto accidents to wrongful terminations.
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