How to File Bankruptcy in Arkansas

Find information you'll need to prepare your Arkansas bankruptcy.

December 19. 2017

When you’re having difficulty making ends meet, filing for bankruptcy in Arkansas can be a good solution. The first step is deciding whether you’re better off filing for Chapter 7 or Chapter 13 bankruptcy. Then you’ll complete your bankruptcy paperwork (petition) and submit it to the federal bankruptcy court.

But finding the information you’ll need to complete the petition can be challenging. In this article, you’ll learn where to find the law that allows you to protect property in an Arkansas bankruptcy. You’ll also find other helpful information, such as where to find official bankruptcy forms, Arkansas means test figures (for qualification purposes), required course providers, and your local bankruptcy court.

Official Bankruptcy Forms

Before the Arkansas bankruptcy court can discharge (wipe out) your qualifying debt, you must agree to be completely transparent about your financial condition. On official bankruptcy forms, you’ll disclose the amount of money you make, your monthly expenses and bills, all of the property you own, and past financial transactions, such as a property transfer or bank account closure.

You can fill out and download the forms on the U.S. Courts form page.

You’ll file the paperwork in the Arkansas bankruptcy court, along with a filing fee or a request for a fee waiver, and proof that you’ve completed the required prefiling bankruptcy course (more below).

Arkansas Bankruptcy Information

Federal law governs bankruptcy filings, but some aspects of Arkansas law and procedure will also come into play.

Arkansas Bankruptcy Exemptions

Filing for bankruptcy doesn’t mean you’ll lose everything. But it doesn’t necessarily mean you’ll get to exempt (keep) all of your property, either.

You’ll be able to protect any property that appears on the list of Arkansas exemptions or the federal bankruptcy exemptions list. As an Arkansas resident, you’ll pick the list that will work best for you, but you can’t pick and choose individual exemptions from both lists. (If you use the Arkansas list, you’ll be able to use federal nonbankruptcy exemptions, too.)

In a Chapter 7 bankruptcy, the trustee appointed to manage your matter will sell any property that doesn’t appear on the exemption list for the benefit of your creditors. By contrast, you can keep all of your property in a Chapter 13 bankruptcy. But, there’s a catch. You must pay the nonexempt property value to your creditors through the three- to five-year Chapter 13 repayment plan.

Here are the more common exemptions available under Arkansas law. Spouses filing a joint bankruptcy in Arkansas can double the exemption amount if they both own the property (except for the homestead exemption). (References are to the Arkansas Code Annotated or the Arkansas Constitution.)

  • Homestead or residential property. Choose A or B. but not both. A: Unlimited amount of equity in 80 rural acres or one-quarter urban acre. If the land isn’t worth $2,500, you can increase the acreage up to 160 rural acres and one urban acre, up to a total equity value of $2,500 in value. B: Real or personal property used as a residence up to $800 if single or $1,250 if married. (Ark. Const. Art. 9 §§ 3, 4, 5, 6; Ark. Code Ann. §§ 16-66-210, 212, 218)
  • Personal property. All clothing; a single person who is not the head of the family can keep $200 worth of any other type of property. The amount increases up to $500 for a married person or head of the family. (Ark. Const. Art. 9 §§ 1 and 2, Ark. Code Ann. § 16-66-218); motor vehicle up to $1,200 (Ark. Code Ann. § 16-66-218); tools needed in your trade or profession up to $750 (Ark. Code Ann. § 16-66-218); wedding bands (Ark. Code Ann. §§ 16-66-218, 219); life, health, and disability insurance payments (Ark. Code Ann. § 16-66-209); pension or retirement account up to $20,000 (Ark. Code Ann. § 16-66-220). (More exemptions could be available for retirement benefits. See Your Retirement Plan in Bankruptcy.)
  • Public benefits. Workers' compensation (Ark. Code Ann. § 11-9-110); unemployment compensation (Ark. Code Ann. § 11-10-109); crime victims' compensation (Ark. Code Ann. § 16-90-716).

Additional exemptions exist. Also, Arkansas updates exemption amounts periodically. Check the Arkansas statutes on the website for the Arkansas State Legislature to make sure you are using all exemptions available and that you have the most recent figures, or meet with a local bankruptcy lawyer.

Means Testing Information and Course Providers

You can find two types of Arkansas-specific information on the website of the U.S. Trustee: means testing figures and approved course providers.

  • Means test data. You’ll be entitled to a Chapter 7 discharge if you meet income guidelines and pass the “means test.” A gross family income below the Arkansas median income for a family of the same size will pass. If it’s above the median, you still might pass after deducting allowed expenses. You’ll find the income charts and expense figures on the U.S. Trustee’s website under “Means Testing Information.” A similar calculation is used to determine your monthly payment in a Chapter 13 bankruptcy.
  • Course providers. Most filers must complete a session with a credit counseling service before filing for bankruptcy and a debt management course before receiving a discharge. You’ll find approved providers under “Credit Counseling & Debtor Education.” (Scroll down to the District of Arkansas.)

Arkansas Bankruptcy Court Website and Locations

Each court creates its own rules that you must follow, and some might have local forms, too. You’ll find the court’s local rules and instructions for filing your paperwork on the Arkansas bankruptcy court website by clicking on “Filing Information“ on the navbar.

Arkansas has two districts—the Eastern and Western districts—and several divisions within those districts. To determine where to file, go to “Court Information” and click on “Arkansas Map-County Codes-Case Numbering.”

Eastern District of Arkansas

Western District of Arkansas

U.S. Bankruptcy Courthouse
300 West 2nd Street
Little Rock, AR 72201
(501) 918-5500
Divisional Office
Federal Building Room 316
35 E. Mountain Street
Fayetteville, AR 72701
(479) 582-9800

This article provides resources that will help a filer find some of the information needed to prepare a bankruptcy filing; however, each filer is responsible for understanding the law. A do-it-yourself book like How to File Chapter 7 Bankruptcy by Attorney Cara O’Neill and Albin Renauer J.D. can help you make important decisions in your case.

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