Who Is Eligible to File Chapter 13?

 Posted on June 23, 2025 in Chapter 13 Bankruptcy

Chapter 13 bankruptcy offers a lifeline for people struggling with debt. Unlike Chapter 7 bankruptcy, which liquidates assets to pay back creditors, Chapter 13 creates a manageable repayment plan that generally lasts three to five years. However, not everyone qualifies for this "wage earner's plan." 

Those who do can take advantage of Chapter 13’s unique benefits, including the ability to keep certain non-exempt property such as a second home or valuable personal assets. Speak to our experienced Brazoria, TX Chapter 13 bankruptcy attorney to figure out if you qualify for Chapter 13 bankruptcy.

How Do You Qualify for Chapter 13?

Maintain a Regular Income

Because you have to make payments into a plan, you must have an income to file Chapter 13. The income requirement does not mean that you must have a full time job, however. Social Security benefits, disability payments, pension income, rental property income, or even regular unemployment benefits can help you qualify. However, your income must be steady and predictable enough to make monthly plan payments for the three to five year Chapter 13 duration. Self-employed individuals and business owners can also file Chapter 13, but they will need to demonstrate consistent income patterns.

Stay Under the Debt Limit 

Chapter 13 has strict debt limits that change periodically. As of 2025, you cannot have more than approximately $526,700 in unsecured debt (such as credit cards, medical bills, or personal loans), or just over $1.5 million in secured debt (such as mortgages or car loans). 

Stay Current on Tax Filings

You must be current on your income tax filings. If you have not filed your federal and state taxes for the past four years, the court will not confirm your repayment plan. You will need to get caught up before moving forward.

Avoid Prior Bankruptcy Filings

Your bankruptcy history affects eligibility. If you received a Chapter 7 discharge within the past four years or a Chapter 13 discharge within the past two years, you cannot file another Chapter 13 discharge. However, if you previously filed Chapter 13 but did not complete the plan or receive a discharge, you may be able to file again sooner, although courts scrutinize repeat filings carefully.

Fulfill Credit Counseling Requirement

Before filing, you must complete credit counseling from an approved agency within 180 days, or you may not file for bankruptcy. 

File Bankruptcy in Good Faith

Courts expect Chapter 13 filers to act in good faith. This means that your financial problems should be genuine, not an attempt to manipulate the system. Judges can dismiss cases if they believe someone is trying to abuse the bankruptcy process.

Call a Brazoria, TX Chapter Bankruptcy Attorney 

Chapter 13 eligibility involves complex calculations and legal requirements. If you think that filing for Chapter 13 might be the best option for you, reach out to the experienced Conroe, TX Chapter 13 bankruptcy attorney. At The Fealy Law Firm, PC, we focus on helping good people through hard times. Call us at 713-526-5220 for a complimentary consultation.