Filing for Bankruptcy in South Carolina (SC)

When filing for bankruptcy in South Carolina, you’ll need to understand federal law and South Carolina’s exemption laws. This article provides instructions for filing for bankruptcy in South Carolina.

By , Attorney · University of the Pacific McGeorge School of Law

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Facing financial challenges is a part of life. But if you're one of the millions struggling financially due to a job loss, illness, or another event in South Carolina, bankruptcy can help. Here, you'll find an explanation of Chapters 7 and 13, checklists to help you understand the process and stay organized, and South Carolina's property exemption laws and filing information.

Because we couldn't include everything in one article, you'll want to check out its companion, What You Need to Know to File for Bankruptcy. You'll find lots more details there.

How Does Bankruptcy Work in South Carolina?

In most respects, filing for bankruptcy in South Carolina isn't different from filing in another state. The bankruptcy process falls under federal law, not South Carolina state law, and works by unwinding the contracts between you and your creditors. That's what gives you a fresh start.

But South Carolina's laws come into play significantly because they determine the property you can keep in your bankruptcy case. You'll also need to know other filing information, which we explain after reviewing some basics.

How Do I Choose the Right Bankruptcy Chapter in South Carolina?

Most people file either Chapter 7 or Chapter 13, and you're not alone if you don't know how the two differ. The short explanation below and our handy Chapter 7 versus 13 chart will help clarify things.

Filing for Chapter 7 in South Carolina

Chapter 7 is often a bankruptcy filer's first choice for several reasons. It's quick, taking only a few months to complete. And it's cheap. You don't pay anything to creditors.

Chapter 7 bankruptcy works well for people who own mainly the essential items needed to live and work and not much else. People with more assets could lose them in Chapter 7 because the Chapter 7 trustee, the official responsible for the case, sells unnecessary luxury items and distributes the proceeds to creditors. For instance, you might have to give up your RV, baseball card collection, or timeshare in the Bahamas, even your house or vehicle if you have more equity than you can keep.

Also, unlike Chapter 13, Chapter 7 has no payment plan option for catching up on late mortgage or car payments. So you could lose your home or car if you're behind on the loan when you file.

Filing for Chapter 13 in South Carolina

Chapter 13 involves repaying creditors some or all of what's owed using a three- to five-year repayment plan. Chapter 13 filers keep everything they own, and the payment plan provides ways to improve sticky financial situations.

For instance, you can catch up on late payments and save your home from foreclosure or your car from repossession. Also, if you need time to repay a debt you can't eliminate or "discharge" in bankruptcy, you can use Chapter 13 to force a creditor into a payment plan and repay your balance over time. Learn more about when filing for Chapter 13 is better than Chapter 7.

The biggest downside to this chapter? It can be expensive. Many people can't afford the monthly payment. Also, businesses can't file a Chapter 13 case. If you're a business owner, it's a good idea to learn about the ins and outs of small business bankruptcies before choosing the bankruptcy right for you.

Will Filing for Bankruptcy in South Carolina Erase My Debts?

Bankruptcy wipes out many bills, like credit card balances, overdue utility payments, medical bills, personal loans, and more. You can even get rid of a mortgage or car payment if you're willing to give up the house or car that secures the debt. (Putting property up as collateral creates a "secured debt." If you don't pay what you owe, the lender recovers the property.)

But you can't discharge all debts. You'll want to be sure that bankruptcy will discharge (get rid of) enough bills to make it worthwhile.

For instance, nondischargeable debts, like domestic support arrearages and recent tax debt, won't go away in bankruptcy. Also, student loans aren't easy to wipe out because you'd have to win a separate lawsuit (however, in 2023, steps have been taken to ease the student loan discharge process with a new student loan bankruptcy form).

Learn more about student loans in bankruptcy.

How Do I Qualify for Chapter 7 or Chapter 13 Bankruptcy in South Carolina?

You won't be surprised to learn that qualifying for bankruptcy involves meeting several requirements. Because you're only entitled to a discharge every few years, if you've filed before, you'll want to check whether enough time has passed to allow you to file again. The waiting period varies depending on the chapter previously filed and the chapter you plan to file. Learn more about multiple bankruptcy filings.

You'll also need to meet specific chapter requirements. Here are the qualification basics for Chapters 7 and 13.

Chapter 7 Bankruptcy Qualifications

You'll qualify for Chapter 7 bankruptcy if your family's gross income is lower than the median income for the same size family in your state. Add all gross income earned during the last six months and multiply it by two. Compare the figure to the income charts on the U.S. Trustee's website (select "Means Testing Information").

Want an easy way to do this online? Use the Quick Median Income Test. If you make too much, you still might qualify after taking the second part of the "means test." If, after subtracting expenses, you don't have enough remaining to pay into a Chapter 13 plan, you'll qualify for Chapter 7.

Chapter 13 Bankruptcy Qualifications

Qualifying for Chapter 13 can be expensive because the extra benefits come at a hefty price, and many people can't afford the monthly payment. To qualify, you'll pay the larger of:

  • your priority nondischargeable debt
  • the value of nonexempt property, or
  • your disposable income.

Find out more about calculating a Chapter 13 bankruptcy payment.

How Do I Keep Property in South Carolina Using Bankruptcy Exemptions?

You won't lose everything in bankruptcy. You'll use bankruptcy exemption laws to protect your property. We list the significant exemptions below, but first, understanding the following will help you maximize what you'll keep in your case.

  • Exempt and nonexempt property. You can keep property protected by an exemption or "exempt" property. When a bankruptcy exemption doesn't cover the property, you'll either lose it in Chapter 7 or have to pay for it in the Chapter 13 repayment plan.
  • Choosing state or federal exemptions. Because the federal exemptions aren't available in this state, you must use the state exemptions. But you can also use the federal nonbankruptcy exemptions.
  • Doubling exemptions. In many instances, spouses filing together can double the exemption amount if both own the property.
  • Retirement accounts all filers can protect. Federal law allows all filers to keep tax-exempt retirement accounts, including 401(K)s, 403(b)s, profit-sharing and money purchase plans, SEP and SIMPLE IRAs, defined benefit plans, and traditional and Roth IRAs to $1,512,350 per person (for cases filed between April 1, 2022, and March 31, 2025). (11 U.S.C. 522(b)(3)(C); (n).) Learn more about retirement accounts in bankruptcy.

What Are the Bankruptcy Exemptions in South Carolina?

Bankruptcy filers in South Carolina can protect some home and vehicle equity, personal possessions, retirement accounts, and more. Below is a list of the exemptions commonly used when filing for bankruptcy.

South Carolina Homestead Exemption

A homestead exemption helps you keep your home in bankruptcy. In South Carolina, you can protect up to $67,100 in equity in a home or real estate you use as a residence. Married couples can double the exemption, bringing it to $134,200. (§ 15-41-30(A)(1).) Learn more about South Carolina's homestead exemption in bankruptcy.

South Carolina Motor Vehicle Exemption

A motor vehicle exemption ensures you have transportation after bankruptcy. South Carolina's motor vehicle exemption protects $6,700 in equity. (§ 15-41-30(A)(2).)

South Carolina Wildcard Exemption

If you own something not covered by an exemption, a wildcard exemption can help. Not all states have one, but South Carolina's wildcard exemption lets you use unused exempt amounts up to $6,700 to protect any property you choose. (§ 15-41-30(A)(7).) Find out more about the wildcard exemption in bankruptcy.

Other South Carolina Exemptions

  • Personal property. Up to $5,375 in animals, appliances, books, clothing, crops, furniture, household goods, and musical instruments; $67,100 for a burial plot and $6,700 in cash if not using the homestead exemption; health aids; $1,350 in jewelry; personal injury and wrongful death recoveries for a person that you depended on for support (§§ 15-41-30(A)(1)-(8)); three guns (rifle, shotgun, or pistol up to $3,000)(§ 15-41-30(A)(15)); college investment program trust fund (§ 59-2-140).
  • Tax-exempt retirement accounts. Your share of a pension plan fund (§ 5-41-30(10)(E),(14)); firefighters. (§ 9-13-230); general assembly members (§ 9-9-180); judges, solicitors (§ 9-8-190); police officers (§ 9-11-270); public employees (§ 9-1-1680).
  • Public benefits. General relief and aid to the elderly, visually impaired, or those with a disability (§ 43-5-190); local public assistance (§ 15-41-30(A)(11)); Social Security (§ 15-41-30(A)(11)); unemployment compensation (§ 15-41-30(A)(11)); veteran's benefits (§ 15-41-30(A)(11)); workers' compensation (§ 42-9-360).
  • Tools of the trade. Up to $2,025 in tools, books, and other implements needed in your trade or profession. (§ 15-41-30(A)(6)).
  • Life insurance. Accident, disability, or illness benefits (§ 15-41-30(A)(11), § 38-63-40(D)); proceeds and cash surrender values of life insurance for the insured's spouse, children, or dependents (not the estate and the amount is limited if the insured purchased the policy within two years of the bankruptcy filing) (§§ 38-63-40(A), 15-41-30(A)); group life insurance proceeds up to a particular amount (§ 38-63-40(A)); any life insurance or annuity benefits exempt from creditors under the contract (§ 38-63-40(B)); life insurance benefits received upon death (§ 38-63-50); fraternal benefit society benefits (§ 58-37A-18); an unmatured life insurance contract (other than a credit insurance policy); any dividend, interest or loan value of an unmatured life insurance contract up to a specified amount (§ 15-41-30(A)(8),(9)).
  • Miscellaneous. Alimony and child support (§ 15-41-30(A)(11)(d)); some partnership property (§ 33-41-720).

State exemption amounts are adjusted periodically and are not being updated in this article. These South Carolina exemptions were adjusted for inflation on July 1, 2022, and will be changed again in two years.

Be sure to check for updates with a bankruptcy lawyer or on the website for the South Carolina Legislature. also updates state bankruptcy exemption amounts regularly.

When Can I Use South Carolina Bankruptcy Exemptions?

You can file for bankruptcy in South Carolina after living there for over 180 days. However, you must live in South Carolina for at least 730 days before filing. Otherwise, you'd use the previous state's exemptions.

If you lived in multiple states during the two years before filing for bankruptcy, you'd use the exemptions of the state you lived in for most of the 180 days before the two years immediately preceding your filing. (11 U.S.C. § 522(b)(3)(A).)

Learn more about filing for bankruptcy after moving to a new state.

How Do I Prevent Bankruptcy Exemption Problems in South Carolina?

Exempt your property carefully. The bankruptcy trustee, the court-appointed official assigned to manage your case, will review the exemptions. A trustee who disagrees with your exemptions will likely try to resolve the issue informally. If unsuccessful, the trustee will file an objection with the bankruptcy court, and the judge will decide whether you can keep the property.

Example. Mason owns a rare, classic car worth $15,000, but the state vehicle exemption doesn't cover it entirely. Believing that the car qualifies as art, at least in his mind, Mason exempts it using his state's unlimited artwork exemption. The trustee disagrees with Mason's characterization and files an objection with the court. The judge will likely decide the vehicle doesn't qualify as art.

Purposefully making inaccurate statements could be considered fraudulent. Bankruptcy fraud is punishable by up to $250,000, 20 years in prison, or both.

Should I Hire a Bankruptcy Lawyer in South Carolina?

Most people find it worthwhile to get counsel. A bankruptcy attorney will help you:

  • qualify for the chapter of your choice
  • determine when it's time to file
  • help you keep the property you want
  • make sure you don't run afoul of fraud or other issues, and
  • explain when you can stop paying the bills you'll erase in your case.

You can expect creditors to call until you file. It's usually best to ignore them because telling creditors about your bankruptcy can encourage them to take more drastic collection steps before losing the right to collect altogether. However, if you hire counsel and refer creditors to your lawyer, they'll have to stop calling you.

How Do I File for Bankruptcy in South Carolina Without a Lawyer?

You'll complete the steps listed below in "What Steps Are Involved in a South Carolina Bankruptcy?" But not everyone should file their own bankruptcy case.

The best candidate is a Chapter 7 debtor who meets qualification requirements, can eliminate all debts, and can protect all property with bankruptcy exemptions. People filing for Chapter 13 or Chapter 7 filers with complicated cases should seek representation.

Are you curious whether your case is simple enough to file yourself? Our quiz will help you identify potential complications while educating you about bankruptcy. You'll find it here: Do I Need a Lawyer to File for Bankruptcy?

How Much Does It Cost to File for Bankruptcy in South Carolina?

All filers pay a $338 filing fee in Chapter 7 unless the court grants a fee waiver and a $313 filing fee in Chapter 13 (amounts current as of August 2023). You'll also pay approximately $50 to $75 for credit counseling and debt management courses.

If you hire a bankruptcy lawyer to represent you, you can expect to pay from $1,500 to $2,500 upfront for most Chapter 7 cases, although the price will depend on the going rates in your area and case complexity. Chapter 13 legal fees run about $1,000 to $1,500 more, but you can pay them in installments through the Chapter 13 payment plan.

Learn about your options if you can't afford to hire a bankruptcy attorney.

What Steps Are Involved in a South Carolina Bankruptcy?

We all know that seeing the forest helps us recognize the trees. Similarly, understanding the significant steps you'll take during your bankruptcy journey will help you understand the bankruptcy process. Think of this checklist as a roadmap you can use to track progress.

Bankruptcy Steps Checklist

What Do I Need to File for Bankruptcy in South Carolina?

Once you decide to file, the fun begins! Well, not really. You'll start by gathering your financial information, which can take time. But our bankruptcy document checklist should help you organize what you or your attorney will need.

Bankruptcy Document Checklist

Where Do I Find the South Carolina Bankruptcy Court Website and Locations?

Your case starts when you file your paperwork with the local bankruptcy court. You'll find the court's local rules and instructions for filing your paperwork in the proper location on the South Carolina Bankruptcy Court website (click on "Filing Without an Attorney"). The addresses for South Carolina's three bankruptcy courts are below.




U.S. Bankruptcy Court

145 King Street, Room 225

Charleston, SC 29401

U.S. Bankruptcy Courthouse

1100 Laurel Street

Columbia, SC 29201-2423

U.S. Bankruptcy Court

201 Magnolia Street

Spartanburg, SC 29306

What Happens After Filing for Bankruptcy in South Carolina?

Your creditors will stop bothering you soon after you file. It takes a few days because the court mails your creditors notice of the "automatic stay" order that prevents most creditors from continuing to ask you to pay them. Here's what will happen next:

  • You'll turn over financial documents proving the statements in your bankruptcy paperwork.
  • You'll attend the 341 meeting of creditors—the one appearance all filers must attend.
  • You'll complete a debtor education course and file the completion certificate.

These things must happen before you get a Chapter 7 bankruptcy discharge. Chapter 13 filers will also attend a repayment plan confirmation hearing and complete the three- to five-year payment plan.

Need More Bankruptcy Help?

Did you know Nolo has made the law easy for over fifty years? It's true, and we want to ensure you find what you need. Below, you'll find more articles explaining how bankruptcy works. And don't forget that our bankruptcy homepage is the best place to start if you have other questions!

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Helpful Bankruptcy Sites

Department of Justice U.S. Trustee Program

United States Courts Bankruptcy Forms

We wholeheartedly encourage research and learning, but online articles can't address all bankruptcy issues or the facts of your case. The best way to protect your assets in bankruptcy is by hiring a local bankruptcy lawyer.

Updated October 4, 2023

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