Can Non-Citizens File Bankruptcy in the United States? A Complete Guide
Many people assume that bankruptcy is only available to U.S. citizens, but this is not the case. Non-citizens, including foreign nationals, permanent residents, and non-immigrant aliens, can file for bankruptcy in the United States under certain conditions. Understanding eligibility requirements and the nuances of exemptions is essential for anyone navigating this process.
Eligibility for Non-Citizens Under Section 109(a)
The eligibility of non-citizens to file bankruptcy is governed by Section 109(a) of the Bankruptcy Code, which states that only a person who “resides or has a domicile, a place of business, or property in the United States” may be a debtor. This rule applies equally to U.S. citizens and non-citizens, including foreign nationals and non-immigrant aliens, provided they meet the statutory requirements.
Courts have interpreted this provision broadly. Even minimal property in the U.S. can satisfy eligibility requirements. For instance:
In re Aerovias Nacionales de Colombia S.A.: A few thousand dollars in a U.S. bank account or unearned retainers for local counsel sufficed for eligibility.
In re Iglesias: A $500 bank account was deemed adequate to file for bankruptcy.
In re Xacur: A Mexican citizen owning substantial property in the U.S. for over 17 years qualified.
In re Zawawi: A foreign debtor with property in the U.S. met eligibility requirements.
These cases demonstrate that non-citizens with even minimal U.S. ties—through property, business, or domicile—can qualify for bankruptcy relief.
Non-Immigrant Aliens and Federal Exemptions
Non-immigrant aliens residing in the U.S. can also claim federal bankruptcy exemptions under certain circumstances.
In re Arispe: A non-immigrant alien in Florida was allowed to use federal bankruptcy exemptions even without state domicile.
In re Levy: Non-immigrant aliens on temporary visas may be unable to claim state-specific exemptions because they cannot establish intent to permanently reside in that state.
This distinction means that while non-immigrant aliens can file, the type of exemptions they can claim may depend on their visa status and residence intentions.
Permanent Residents and Other Immigration Statuses
Permanent residents, or “green card” holders, generally qualify to file bankruptcy if they meet Section 109(a) requirements:
In re Steadman: A foreign national with conditional permanent residency was eligible to file.
In re Mendoza: Immigrant debtors residing in Florida for five years with pending asylum applications were considered domiciled and eligible.
Other immigration statuses can similarly satisfy bankruptcy requirements, provided the individual maintains property, a domicile, or a business presence in the U.S.
Foreign Debtors and Cross-Border Cases
Non-citizens involved in cross-border insolvency can file under Chapter 15 if they meet Section 109(a) requirements. Courts have consistently applied this standard:
In re Agro Santino, OOD: Foreign debtors must have a domicile, place of business, or property in the U.S. to qualify.
In re Northshore Mainland Services, Inc.: Minimal U.S. property sufficed to establish eligibility.
Even foreign corporations or individuals with limited assets in the U.S. may file to protect their interests and restructure debt efficiently.
Key Takeaways
Non-citizens can file bankruptcy in the U.S. if they reside, own property, or have a business presence in the country.
Minimal property or financial ties—even a small bank account—can establish eligibility.
Exemptions vary by immigration status: Permanent residents may claim state exemptions; non-immigrant aliens may rely on federal exemptions.
Cross-border filings are possible under Chapter 15 if eligibility criteria are met.
Bankruptcy law in the U.S. is designed to provide relief to anyone meeting statutory requirements, regardless of citizenship. Non-citizens navigating financial challenges should consult with an experienced bankruptcy attorney to understand their eligibility, exemption options, and filing strategy.
At Bankruptcy Near Me, we help clients:
Stop collection calls and wage garnishments immediately
Eliminate or restructure credit card debt, medical bills, and other unsecured debts
Protect assets and get a fresh financial start
Contact us today to discuss your options:
Santa Ana, California (Orange County): 714-798-2544
Kensington, Maryland (Montgomery County): 301-550-5408
Email: info@bankruptcynearme.org