Eligibility

• Chapter 13 bankruptcy is often referred to as a wage-earner's plan, meaning you must be able to prove to the court that you have sufficient and steady income to make regular payments on your debts. As of 2010, federal law permits Chapter 13 debtors to include a maximum of $360,475 in unsecured debt and up to $1,081,400 in secured debt in their filing. The bankruptcy code also requires that all Chapter 13 debtors complete certified credit counseling within the 180 days prior to filing. If you're filing under emergency circumstances, you may be able to waive this requirement. You are ineligible to file if you've had a bankruptcy petition dismissed, either voluntarily or involuntarily, during the preceding 180 days.
  
  

Filing Requirements

• All Chapter 13 petitions must be filed with the district bankruptcy court nearest to where you live. There is at least one district bankruptcy court located in each state. When you file, you are required to submit the appropriate filing fee and the appropriate supporting documentation. As of 2010, the filing fee for Chapter 13 was $274. If you are experiencing a financial hardship, you may petition the court to pay in installments or have the fees waived altogether. When you file, you have 14 days to provide the court with copies of your prior year's tax return, income statements, list of debts and assets, list of unexpired leases or contracts and a statement of financial affairs. Failure to provide any of these documents may result in a dismissal.
  
  

Chapter 13 Plan

• Within 30 days of filing your petition, you must begin making payments to court according to the terms of your repayment plan. This plan details how you plan to repay your debts. Your plan will last three or five years, depending on your income. To determine the length of your repayment plan, the court will compare your median income for the previous six months against state median income limits. If your median income is at or below the limit for your family size, your plan will last three years. If it's higher, your plan will last five years. Federal law requires that certain debts, including tax debts, child support and alimony, be repaid first and in full.
  
  

Considerations

• The court must approve your plan in a separate confirmation hearing. If the court rejects your plan, you may file a modified version or convert your case to a Chapter 7 bankruptcy. All plan payments must be made in full in order to receive a discharge of your case. You cannot discharge fraudulent debts, governmental penalties or fines or any amounts owed due to your liability in a personal injury or wrongful death lawsuit. Student loans also cannot be discharged through bankruptcy, unless you're able to prove to the court that your financial situation prevents you from repaying the debt.