{"id":286872,"date":"2021-04-22T06:47:54","date_gmt":"2021-04-22T11:47:54","guid":{"rendered":"https:\/\/ability-fl-prod.internetbrands.com\/ability-law\/bankruptcy\/bankruptcy-laws-by-state\/pennsylvania-bankruptcy-exemptions-and-law.html"},"modified":"2026-09-25T14:26:19","modified_gmt":"2026-09-25T19:26:19","slug":"pennsylvania-bankruptcy-exemptions-and-law","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/state\/pennsylvania-law\/pennsylvania-bankruptcy-exemptions-and-law.html","title":{"rendered":"Pennsylvania Bankruptcy Exemptions and Law"},"content":{"rendered":"\n
\n

Pennsylvania Bankruptcy Exemptions and Law<\/h1>\n\n
\n
\n By Christie Nicholson, J.D.<\/a> | Legally reviewed by Catherine Hodder, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
\n

This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
\n

The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

\n
\n
\n

Key Takeaways<\/h2>\n

Pennsylvania<\/span> bankruptcy law<\/span> is a legal framework under federal U.S. Bankruptcy Code<\/span> rules and state-specific exemptions that allows insolvent individuals and businesses to eliminate or reorganize their debt. Debtors can file under Chapter 7 liquidation<\/span> or Chapter 13 repayment plans<\/span>, using either federal exemptions or minimal state provisions to protect assets like real estate equity and motor vehicles<\/span>.<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n

\n

Many families live from paycheck to paycheck. Close to 30% of Americans<\/a> report that they are either just getting by financially or struggling to pay their bills. It’s no surprise, then, that people continue to turn to bankruptcy to catch up and get much-needed debt relief<\/span>.<\/p>\n

Although federal law<\/span> generally governs bankruptcy, states can pass their own bankruptcy laws<\/span>. For example, each state decides whether people who file for\u00a0bankruptcy\u00a0can protect their home and other assets. State laws also dictate which assets are considered exempt in a bankruptcy filing.<\/p>\n

In this article, we explain Pennsylvania<\/span>\u00a0bankruptcy laws<\/span>,\u00a0including who can file for bankruptcy and the requirements\u00a0to file a bankruptcy case<\/span>. We will also discuss the Pennsylvania<\/span> bankruptcy exemptions<\/span>.<\/p>\n

If you\u2019re thinking of filing for a Chapter 7 or Chapter 13 bankruptcy<\/span> and aren\u2019t sure what to expect, consider contacting a Pennsylvania<\/span> bankruptcy attorney<\/span><\/a> for help. It\u2019s important that you file your bankruptcy petition<\/span> correctly so you don\u2019t have to refile your case later.<\/p>\n

Pennsylvania Bankruptcy Law<\/strong><\/h2>\n

All bankruptcy cases<\/span> are governed by the U.S. Bankruptcy Code<\/span><\/a>. The Bankruptcy Code<\/span> is a set of rules and procedures the bankruptcy courts<\/span> and trustees must follow when handling bankruptcy proceedings.<\/p>\n

Federal law<\/span> dictates some things, such as\u00a0eligibility<\/span>\u00a0requirements to\u00a0file bankruptcy<\/span>. However, other rules, such as the amount of certain bankruptcy exemptions, fall under Pennsylvania<\/span>\u2019s bankruptcy laws<\/span>.<\/p>\n

In addition to the requirements for filing a liquidation<\/span> or reorganization bankruptcy, federal law<\/span> controls the application of the \u201cautomatic stay<\/span>.\u201d The automatic stay<\/span> <\/a>protects debtors from collection action by creditors whose debts are part of the Chapter 13 or Chapter 7 filing<\/span>.<\/p>\n

Requirements for Filing Bankruptcy in the State of Pennsylvania<\/strong><\/h2>\n

The eligibility<\/span> requirements for filing bankruptcy<\/span> in Pennsylvania<\/span> are the same as in other states. Of course, the requirements for Chapter 7 differ from those for a Chapter 13 <\/span>bankruptcy<\/span> case<\/span><\/a>.<\/p>\n

Generally, all debtors must cooperate with the bankruptcy trustee<\/span>. For instance, they must provide the\u00a0bankruptcy trustee<\/span>\u00a0with requested documents, answer the trustee\u2019s questions honestly, and attend all scheduled meetings.<\/p>\n

Chapter 7 Bankruptcy Filing Requirements<\/strong><\/h3>\n

Chapter 7 bankruptcy<\/span> debtors must also pass something called the \u201cMeans Test<\/span><\/a>.\u201d Under the means test<\/span>, to qualify for Chapter 7 bankruptcy<\/span>, you must earn less than your state\u2019s median household income.<\/p>\n

The exact threshold amounts are adjusted two to three times a year. It also depends on the size of your household. According to the U.S. Trustee Program, the current median household income for a two-person household in Pennsylvania<\/span> is $87,534. For a four-person household, the median income level is $135,862.<\/p>\n

You can use the means test<\/span> calculator below to estimate whether you qualify for Chapter 7 in Pennsylvania<\/span>.<\/p><\/div>\n<\/div>\n\n\n\n