TOMS RIVER, NJ – Not everyone who seeks bankruptcy protection in New Jersey qualifies to file, and certain actions can result in case dismissal or denial of discharge even after filing. New Jersey bankruptcy attorney Daniel Straffi, Jr. of Straffi & Straffi Attorneys at Law (https://www.straffilaw.com/what-disqualifies-you-from-filing-bankruptcies/) is outlining the income requirements, waiting periods, and conduct-based factors that can disqualify individuals from bankruptcy relief.

According to New Jersey bankruptcy attorney Daniel Straffi, Jr., eligibility for Chapter 7 depends largely on whether household income falls below the state median for the filer’s family size. For cases filed on or after April 1, 2026, the New Jersey median family income figures are $87,173 for one person, $106,876 for two people, $137,136 for three people, and $168,127 for four people, with $11,100 added for each additional household member. “If income exceeds the median, the second step of the means test comes into play,” Straffi explains.

New Jersey bankruptcy attorney Daniel Straffi, Jr. notes that high income does not automatically disqualify a filer from Chapter 7. Mortgage payments, car loans, child support obligations, taxes, and health insurance premiums reduce disposable income in the means-test calculation. However, if disposable income remains too high, the court may presume the filing is an abuse under 11 U.S.C. § 707(b), leading to dismissal or conversion to Chapter 13.

Attorney Straffi emphasizes that fraud is among the most serious disqualifying factors. Under 11 U.S.C. § 727(a)(2), the court may deny discharge entirely if a debtor attempted to defraud creditors. “Transferring or selling assets below fair market value before filing, concealing property from the trustee, or running up large luxury-goods debts shortly before filing can all lead to denial of discharge,” Straffi points out. Criminal penalties under 18 U.S.C. § 152 may also apply.

Straffi advises that federal law imposes strict waiting periods between discharges. A debtor must wait eight years from the filing date of a prior Chapter 7 case before receiving another Chapter 7 discharge, six years between a Chapter 13 and a subsequent Chapter 7 (with limited exceptions for plans that paid creditors in full or at least 70% in good faith), four years between Chapter 7 and Chapter 13, and two years between successive Chapter 13 cases. A previously dismissed case can also bar refiling for 180 days under 11 U.S.C. § 109(g).

The firm represents clients before the United States Bankruptcy Court for the District of New Jersey, which handles local filings through the Trenton vicinage at the Clarkson S. Fisher U.S. Courthouse. Chapter 13 has its own eligibility limits. For cases filed on or after April 1, 2025 until March 2028, an individual generally qualifies for Chapter 13 if unsecured debts are less than $526,700 and secured debts are less than $1,580,125.

“Even with a successful discharge, certain debts survive bankruptcy,” Straffi adds. “Domestic support obligations including alimony and child support, most tax debts, and student loans without a showing of undue hardship all remain collectible.” Tax debts may be dischargeable only if the return was due at least three years before filing, the return was actually filed at least two years before filing, the tax was assessed at least 240 days before filing, and there was no willful attempt to evade.

For individuals considering bankruptcy in New Jersey, consulting a New Jersey bankruptcy attorney before filing can prevent procedural missteps and identify whether Chapter 7 or Chapter 13 offers the better path to a fresh start.

About Straffi & Straffi Attorneys at Law:

Straffi & Straffi Attorneys at Law is a Toms River, New Jersey-based law firm dedicated to bankruptcy, foreclosure defense, and family law matters. Led by attorney Daniel Straffi, Jr., the firm represents individuals and families throughout Ocean County, Monmouth County, and southern and central New Jersey. For consultations, call (732) 341-3800.

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Company Name: Straffi & Straffi Attorneys at Law
Contact Person: Daniel Straffi, Jr.
Email: Send Email
Phone: (732) 341-3800
Address:670 Commons Way
City: Toms River
State: New Jersey 08755
Country: United States
Website: https://www.straffilaw.com/