Chapter 13 Eligibility in Kansas City

Chapter 13 has two separate debt limits under 11 U.S.C. § 109(e) (amounts effective April 1, 2025, adjusted every three years):

A temporary combined limit of $2,750,000 (from the Bankruptcy Threshold Adjustment and Technical Corrections Act of 2022) expired on June 21, 2024, and the separate limits returned. Most Kansas City filers are well within them. If your debts exceed either limit, Chapter 11 (including Subchapter V) may be an option.

What counts: Only noncontingent (not dependent on a future event) and liquidated (amount is known or easily calculable) debts count toward the limit. Disputed debts, contingent claims, and unliquidated amounts do not count.

Chapter 13 is available only to "individuals with regular income" (11 U.S.C. section 109(e)). Regular income is defined broadly under section 101(30) as income that is "sufficiently stable and regular to enable such individual to make payments under a plan." This includes:

• Wages, salary, overtime, bonuses, tips
• Self-employment income
• Pension and retirement income
• Social Security benefits
• Disability payments (SSDI, SSI, private disability)
• Regular support from a spouse or family member
• Rental income
• Unemployment benefits (if regular enough)

The income does not need to be large - it just needs to be stable enough that the court believes you can make plan payments. Seasonal workers, gig economy workers, and self-employed individuals can qualify if they can demonstrate a reliable income pattern.

Unlike Chapter 7, Chapter 13 has no means test for eligibility. You can file regardless of how much you earn. However, your income determines:

• Plan length: Below-median income = 3-year minimum plan. Above-median income = 5-year plan required.
• Payment to unsecured creditors: Above-median filers must pay all projected disposable income to unsecured creditors for the full 5-year plan period.
• Feasibility: You must show the court that your income is sufficient to fund the plan - paying secured creditors, priority debts, and at least something to unsecured creditors.

Section 1328(f)(1) - Prior Chapter 7 Discharge

You must wait 4 years from the filing date of a prior case in which you received a Chapter 7 discharge before you can receive a Chapter 13 discharge. You can file the Chapter 13 case sooner (to use the automatic stay to protect property), but you cannot receive a discharge until 4 years have passed.

Section 1328(f)(2) - Prior Chapter 13 Discharge

You must wait 2 years from the filing date of a prior case in which you received a Chapter 13 discharge. Again, you can file sooner but cannot receive the discharge until 2 years have elapsed.

Section 109(g) - Prior Dismissal

If a case was dismissed within the past 180 days for willful failure to comply with court orders or because you sought dismissal after a creditor filed a motion for relief from stay, you cannot file any bankruptcy case for 180 days.