Chapter 13 bankruptcy is a much more in-depth process than Chapter 7. Chapter 13 bankruptcy generally requires you to pay off most or all of your debts within a specific time period, but allows you to keep most of your personal assets. This makes it beneficial for people whose regular income is too high to allow them to file for Chapter 7.
However, some rules and restrictions bar people in certain financial situations from seeking relief from their creditors under Chapter 13. Our Chapter 13 bankruptcy attorneys at Allmand Law Firm could explain Dallas Chapter 13 bankruptcy eligibility in greater detail during a private initial consultation.
Required Documentation for Chapter 13 Eligibility
A Chapter 13 bankruptcy claim’s central component is a repayment plan. It must establish how, in practical financial terms, you will pay off specific debts within three to five years after your initial filing date. To that end, your tax filings for at least four years before your filing date must show that you are employed and will receive enough income to cover the monthly payments outlined in your repayment plan.
When determining whether you are eligible to declare bankruptcy under Chapter 13 in Dallas, you must include these sources of income:
- Commissions
- Regular wages or salary
- Self-employment or seasonal work
- Social Security and workers’ compensation benefits
- Royalties or other income from property ownership
- Court-ordered spousal or child support payments
The court will base its approval of your Chapter 13 repayment plan on your net income. This is your gross income from the above sources minus your expenses for your necessities of life and your payments on secured debts (such as home mortgages).
What Amount of Debt Disqualifies You From Chapter 13 Bankruptcy?
To be eligible to file a Chapter 13 bankruptcy petition in Dallas, you must also not have debts that exceed the threshold amounts established under federal law. These figures change regularly to account for inflation and shifts in the cost of living. As a point of reference, the federal limits as of April 1, 2025, were $526,700 in unsecured debt and $1,580,125 in secured debt.
Contact Our Dallas Attorneys To Discuss Whether You Are Eligible To Make a Chapter 13 Bankruptcy Filing
Establishing your Dallas Chapter 13 bankruptcy eligibility is just the first step in a long and complex process for achieving financial stability. Filing for Chapter 13 bankruptcy could be key to protecting your long-term best interests. However, you should not try to do so without our knowledgeable attorneys’ support because of the potential financial and legal consequences if your case goes awry.
Our team at Allmand Law Firm has the state’s largest pool of bankruptcy knowledge. Call us today to learn what we could do for you.
