Massachusetts Bankruptcy Guide

Complete guide to filing bankruptcy in Massachusetts, including current median income requirements, Massachusetts' exceptional homestead exemption up to $500,000, choice between state and federal exemptions, bankruptcy court information, and how to find qualified bankruptcy attorneys throughout Massachusetts.

Massachusetts Median Income for Bankruptcy (2026)

To qualify for Chapter 7 bankruptcy in Massachusetts, your household income must be below these median income levels. If your income exceeds these amounts, you may still qualify through the means test or need to file Chapter 13 instead.

Household Size	Annual Median Income	Monthly Median Income
1 person	$77,810	$6,484
2 people	$100,241	$8,353
3 people	$117,661	$9,805
4 people	$144,012	$12,001
5 people	$153,012	$12,751
6 people	$162,012	$13,501

Note: For households larger than 4, add $9,000 per additional person. These figures are updated annually by the U.S. Trustee Program. Massachusetts has some of the highest median incomes in the nation.

Calculate Your Massachusetts Eligibility

Massachusetts Bankruptcy Exemptions

Massachusetts allows bankruptcy filers to choose between Massachusetts state exemptions and the federal bankruptcy exemptions. This choice is particularly important in Massachusetts because the state recently enacted one of the most generous homestead exemptions in the country.

Massachusetts Homestead Exemption

Up to $500,000 (or $1,000,000 for elderly or disabled).

Massachusetts has one of the most protective homestead exemptions in the United States. The standard homestead exemption is $500,000, which protects most homeowners even in expensive markets like Boston, Cambridge, and the western suburbs.

If you are age 62 or older, or if you are disabled (as defined by Social Security), the homestead exemption increases to $1,000,000. This provides exceptional protection for elderly Massachusetts homeowners.

The exemption applies to your principal residence including houses, condominiums, mobile homes, and co-ops. Massachusetts' automatic homestead applies to all homeowners, but to claim the full $500,000 or $1,000,000, you must have recorded a homestead declaration with the Registry of Deeds before filing bankruptcy.

Federal Exemption Alternative: Massachusetts filers can instead choose the federal homestead exemption of $27,900 ($55,800 for married couples). Given Massachusetts' generous state homestead, federal exemptions are rarely better for homeowners.

Massachusetts Vehicle Exemption

Up to $15,000.

Massachusetts allows you to protect up to $15,000 of equity in one motor vehicle under state exemptions. This is one of the most generous vehicle exemptions in the country and reflects Massachusetts' high cost of living and vehicle prices.

Federal Exemption Alternative: The federal vehicle exemption is $4,450, which is much lower than Massachusetts' $15,000 state exemption. For vehicle protection, Massachusetts state exemptions are significantly better.

Massachusetts State Exemptions

Massachusetts bankruptcy exemptions include:

• Homestead: $500,000 ($1,000,000 if age 62+ or disabled)
• Vehicle: $15,000
• Household Goods and Furnishings: $15,000
• Clothing: $2,500
• Jewelry: $2,500
• Books: Unlimited if reasonably necessary
• Tools of Trade: $7,500
• Bank Deposits: $2,500 in bank accounts or cash
• Wildcard: $1,250 of any property
• Domestic Animals: $1,250
• Fuel and Provisions: Up to $1,000

Federal Exemptions (Alternative Choice)

Massachusetts filers may choose federal exemptions instead:

• Homestead: $27,900 ($55,800 for married couples)
• Vehicle: $4,450
• Household Goods: $700 per item, up to $14,875 total
• Jewelry: $1,875
• Tools of Trade: $2,800
• Wildcard: $1,475 general + up to $13,950 of unused homestead (total $15,425)

Which Exemptions Should You Choose?

Choose Massachusetts state exemptions if:

• You own a home (Massachusetts $500,000 vs federal $27,900 is a huge difference)
• You're age 62+ or disabled with significant home equity (Massachusetts $1,000,000 homestead)
• You have more than $4,450 equity in your vehicle (Massachusetts allows $15,000)
• You have significant household goods (Massachusetts allows $15,000)
• You have more than $2,500 in bank accounts

Choose federal exemptions if:

• You don't own a home and want the larger federal wildcard ($15,425 total)
• You're a renter with minimal assets and want maximum flexibility with wildcard
• This is an extremely rare choice for Massachusetts homeowners

Other Protected Assets

• Retirement Accounts: Fully protected including 401(k), IRA, pension plans, and government retirement benefits under federal law
• Public Benefits: Social Security, unemployment, workers' compensation, veteran's benefits, disability benefits, public assistance, SNAP
• Life Insurance: Life insurance proceeds if policy prohibits use to pay creditors; cash value of life insurance
• Health Aids: All medically prescribed health aids
• Education Savings: Massachusetts 529 education savings plan (U.Fund College Investing Plan)
• Personal Injury Awards: Personal injury compensation needed for support
• Wrongful Death Awards: Wrongful death recoveries needed for support
• Lost Earnings: Payments for lost earnings needed for support

Filing Bankruptcy in Massachusetts

Chapter 7 Bankruptcy in Massachusetts

Chapter 7 bankruptcy is commonly filed throughout Massachusetts. The process typically takes 3-4 months from filing to discharge and eliminates most unsecured debts including credit cards, medical bills, personal loans, and past-due utility bills.

To qualify for Chapter 7 in Massachusetts, you must pass the means test by having income below the Massachusetts median (which is quite high) or by showing that after allowable expense deductions, you lack sufficient disposable income to fund a Chapter 13 repayment plan. You must also complete credit counseling from an approved agency within 180 days before filing.

Massachusetts' exceptionally generous exemptions, especially the $500,000 homestead ($1,000,000 for elderly/disabled) and $15,000 vehicle exemption, mean that most Massachusetts residents can keep all their assets while obtaining a complete discharge of unsecured debts through Chapter 7.

Learn more about Chapter 7 bankruptcy →

Chapter 13 Bankruptcy in Massachusetts

Chapter 13 bankruptcy allows Massachusetts residents to keep property while repaying some or all debts through a court-approved 3-5 year payment plan. This option is particularly beneficial if you're behind on mortgage or car payments and want to catch up while stopping foreclosure or repossession.

Chapter 13 is especially useful in Massachusetts if your income is too high to qualify for Chapter 7, if you have non-exempt assets you want to protect (extremely rare with Massachusetts' generous exemptions unless you have more than $500,000 in home equity), or if you have priority debts like recent taxes or past-due child support. Your monthly payment is based on your disposable income after allowable living expenses.

Learn more about Chapter 13 bankruptcy →

Bankruptcy Court in Massachusetts

Massachusetts has one federal bankruptcy court district:

District of Massachusetts

Main Courthouses: Boston, Worcester, Springfield

The U.S. Bankruptcy Court for the District of Massachusetts covers the entire state. The court has three divisions corresponding to Massachusetts' main geographic regions:

Eastern Division (Boston): Serves eastern Massachusetts including Boston, Cambridge, Quincy, Lynn, Lowell, Lawrence, Brockton, Plymouth, and the North Shore and South Shore. This is the busiest division, handling the majority of Massachusetts bankruptcy cases due to Greater Boston's population. The courthouse is located in Boston's downtown financial district.

Central Division (Worcester): Serves central Massachusetts including Worcester, Framingham, Marlborough, Fitchburg, and the central region. This division covers Worcester County and surrounding areas.

Western Division (Springfield): Serves western Massachusetts including Springfield, Chicopee, Holyoke, Pittsfield, Northampton, Greenfield, and the Pioneer Valley and Berkshires. This division covers the western portion of the state.

You must file in the district where you have lived for the greater part of the 180 days before filing. Since Massachusetts has only one district, all Massachusetts residents file in the District of Massachusetts, but your case will be assigned to the appropriate division based on your county of residence.

Massachusetts Residency Requirements

To use Massachusetts bankruptcy exemptions (either state or federal), you must have been domiciled (legally residing) in Massachusetts for at least 730 days (2 years) before filing. If you've lived in Massachusetts for less than 2 years, you must use the exemptions from the state where you lived for the 180 days immediately before the 2-year period.

Massachusetts allows you to choose between state and federal exemptions once you meet the residency requirement. Given Massachusetts' extremely generous state exemptions (especially the $500,000 homestead), state exemptions are almost always the better choice for homeowners.

Important: Massachusetts Homestead Declaration

To claim the full Massachusetts homestead exemption of $500,000 (or $1,000,000 if elderly/disabled), you must have recorded a Declaration of Homestead with your county Registry of Deeds before filing bankruptcy.

Without a recorded homestead declaration, you're limited to Massachusetts' automatic homestead of $125,000. While still generous, this is significantly less than the full exemption.

If you haven't filed a homestead declaration yet: Do this immediately before filing bankruptcy. The form is available from your county Registry of Deeds and filing fees are typically $35-50. A Massachusetts bankruptcy attorney can help ensure this is properly completed before filing your case.

Find a Massachusetts Bankruptcy Attorney

Most Massachusetts bankruptcy attorneys offer free initial consultations. Given the complexity of bankruptcy law, the importance of properly claiming Massachusetts' generous exemptions, and the requirement to file a homestead declaration, consulting with an experienced Massachusetts bankruptcy attorney is highly recommended.

What a Massachusetts Bankruptcy Attorney Can Do

• Determine which bankruptcy chapter is right for your financial situation
• Compare Massachusetts state vs. federal exemptions to maximize asset protection
• Ensure you have properly filed a homestead declaration to claim the full exemption
• Help you qualify for the $1,000,000 homestead if you're elderly or disabled
• Calculate whether you qualify for Chapter 7 using the Massachusetts means test
• Navigate Massachusetts-specific bankruptcy procedures and local court rules
• Complete and file all required bankruptcy paperwork correctly
• Represent you at the 341 meeting of creditors
• Handle any objections from creditors or the bankruptcy trustee
• Guide you through the entire process from filing to discharge

Cost of Filing Bankruptcy in Massachusetts

Chapter 7 bankruptcy attorney fees in Massachusetts vary by location:

• Boston metro area (Cambridge, Brookline, Newton): $1,600 to $2,400 plus $338 filing fee
• North Shore (Salem, Lynn, Lowell, Lawrence): $1,400 to $2,000 plus $338 filing fee
• South Shore (Brockton, Plymouth, Quincy): $1,400 to $2,000 plus $338 filing fee
• Worcester area: $1,200 to $1,800 plus $338 filing fee
• Springfield, Pittsfield, Western MA: $1,100 to $1,700 plus $338 filing fee
• Cape Cod and Islands: $1,300 to $1,900 plus $338 filing fee

Chapter 13 attorney fees typically range from $3,500 to $5,500 plus a $313 filing fee. In Chapter 13, attorney fees are usually paid through your repayment plan rather than upfront.

Boston-area attorney fees tend to be higher due to the region's high cost of living. Many Massachusetts attorneys offer payment plans for Chapter 7 to make bankruptcy more accessible.

Massachusetts-Specific Bankruptcy FAQs

Can I keep my house in Massachusetts bankruptcy?

Almost certainly yes. Massachusetts' $500,000 homestead exemption (or $1,000,000 if age 62+ or disabled) is one of the most protective in the nation. Even in expensive markets like Boston, Cambridge, Brookline, or Newton, most homeowners are fully protected. You must have filed a homestead declaration with the Registry of Deeds before bankruptcy to claim the full exemption; otherwise you're limited to the $125,000 automatic homestead.

What happens if I didn't file a homestead declaration?

If you haven't filed a Declaration of Homestead with your county Registry of Deeds, you're limited to Massachusetts' automatic homestead of $125,000 instead of the full $500,000 (or $1,000,000). If you're planning to file bankruptcy, file the homestead declaration immediately—it only costs $35-50 and takes a few days to record. Your bankruptcy attorney can help ensure this is done properly before filing your case.

Can I keep my car in Massachusetts bankruptcy?

Yes, almost always. Massachusetts allows you to exempt up to $15,000 of equity in one motor vehicle, which is one of the highest vehicle exemptions in the country. Most Massachusetts residents with car loans have equity well below this amount and can easily keep their vehicles by continuing payments.

Should I choose state or federal exemptions in Massachusetts?

For homeowners, Massachusetts state exemptions are almost always better. The $500,000 state homestead versus $27,900 federal homestead is a massive difference. The $15,000 vehicle exemption versus $4,450 federal is also much better. Only renters with no home equity and minimal assets might benefit from the federal wildcard, but even then Massachusetts state exemptions are typically superior. Consult with an attorney to analyze your specific situation.

How does bankruptcy affect condos in Boston or Cambridge?

Condominiums qualify for Massachusetts' homestead exemption just like single-family homes. If your condo is your primary residence and you've filed a homestead declaration, you can protect up to $500,000 (or $1,000,000 if elderly/disabled) in equity. You remain responsible for condo fees after filing. Pre-filing condo fee arrears are dischargeable in Chapter 7, but ongoing fees must be paid. In Chapter 13, you can catch up on arrears through your payment plan.

Can I file bankruptcy if I'm a student with student loans in Massachusetts?

Yes. While student loans are generally not dischargeable in bankruptcy, you can still file to eliminate other debts like credit cards, medical bills, and personal loans. This frees up income to pay student loans. In rare cases, student loans can be discharged through an adversary proceeding if you can prove "undue hardship." Massachusetts has many students and recent graduates who successfully use bankruptcy to eliminate other debts while managing student loans separately.

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