An individual in California can make as much money as he or she wants and still possibly be eligible to file for Chapter 13 bankruptcy. However, there are limits to how much debt a person can have at the time he or she files. An individual cannot have unsecured debts of more than $394,725 or secured debts of more than $1,184,200 and still qualify for a Chapter 13 filing.

While there are no income caps in order to file for Chapter 13 bankruptcy, a debtor must generally disclose all forms of income to the court. An individual will also need to show that he or she filed federal and state income taxes over the past four years. If an individual is allowed to seek such protection from creditors, debts will be repaid over a period of three or five years. During the repayment period, a debtor is allowed to keep significant assets like a house or vehicle.

The repayment period depends on how much income a person has for repaying debts. The court will compare a person’s income to both his or her debt level and the median income in the state. In the event that a balance is not fully repaid by the end of three or five years, the balance may be discharged.

Filing for Chapter 13 bankruptcy may be ideal for those who need more time to pay their creditors. By reorganizing debt payments, it may be possible to get current on a home or car loan without losing the asset. During a repayment period, creditors are generally not allowed to have contact with debtors. This may reduce the stress a person feels throughout the process, and an attorney may be able to help someone who is contacted by a creditor despite a stay.