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Chapter 7 Limitations and Disqualifications

Michael Agruss

Written and Reviewed by Michael Agruss

  • Managing Partner and Personal Injury Lawyer at Mike Agruss Law.
  • Over 20 years of experience in Personal Injury.
  • Over 8000+ consumer rights cases settled.
  • Graduated from the University of Illinois Chicago School of Law: Juris Doctor, 2004.

Because Chapter 7 bankruptcy can potentially eliminate debt, Illinois law imposes strict income-and debt-limitations to ensure that this protection is available only for those who need it most.To be eligible for Chapter 7, your income should be below the median income in the state of Illinois, and this income comparison depends partially on the number of people in your household; the income cap starts at around $47,000 for a single-person household and increases by about $9,000-13,000 for each additional person.If your income exceeds Illinois’s median income, you will need to pass a “means test” which determines your disposable income over the next five years. You may be ineligible for Chapter 7 if your disposable income exceeds a certain limit, and there are additional ways in which a debtor could be disqualified for Chapter 7. These may include cases in which the debtor: disobeyed a court order; filed for bankruptcy in the previous six months, but was dismissed for failure to appear at a court hearing; had debt discharged via Chapter 7 or 11 bankruptcy in the previous eight years; or had debt discharged via Chapter 12 or 13 bankruptcy in the previous six years.If you are struggling financially and considering filing for Chapter 7 bankruptcy, you are not alone. Contact an experienced bankruptcy attorney today for a free consultation.

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