Personal bankruptcy under Chapter 7 can eliminate most unsecured debts (credit cards, medical bills, personal loans) in a few months if you qualify under the income-based ‘means test’; Chapter 13 instead sets up a 3-5 year repayment plan, often used to catch up on a mortgage or car loan while keeping the property. New York lets filers choose between federal bankruptcy exemptions and New York’s own exemptions (whichever protects more of your property, like home equity and a vehicle) — a bankruptcy attorney or legal aid clinic can help determine which set works better for your situation. Certain debts, like most student loans, recent taxes, and child support, generally aren’t discharged in bankruptcy.

Federal law (the Fair Debt Collection Practices Act) and New York law limit what debt collectors can do — they generally cannot call before 8am or after 9pm, contact you at work after being told not to, threaten arrest, or discuss your debt with third parties. If you’re sued over a debt, respond by the deadline on the summons (missing it can result in an automatic default judgment); if a collector cannot prove you owe the debt or that it’s within the statute of limitations, you may be able to get the case dismissed. Someone is generally ‘judgment-proof’ if their income (such as Social Security, SSI, unemployment, or public assistance) and property are legally protected from collection — creditors usually cannot garnish these protected income sources even after winning a judgment, though it’s worth confirming your specific situation with a consumer law attorney.

Common scams targeting New Yorkers include fake debt collectors demanding immediate payment by gift card or wire transfer, phishing texts or calls impersonating banks or government agencies, and fake check scams. If you’re contacted about a debt you don’t recognize, ask for written validation before paying anything — real collectors are required to provide it. If you suspect identity theft, place a fraud alert or credit freeze with the three credit bureaus (Equifax, Experian, TransUnion), file a report at identitytheft.gov, and file a police report, which can help dispute fraudulent accounts and collection attempts tied to your name.

Survivors of domestic violence sometimes find debt was taken out in their name without their knowledge or consent, or that a partner’s coerced control of finances left them with joint debts. This is sometimes called ‘coerced debt,’ and there are legal strategies — including disputing fraudulent accounts, seeking orders of protection that address financial matters, and in some cases pursuing claims against the abuser — that a domestic violence legal advocate or consumer law attorney can help with. New York courts can also address debt division and financial abuse as part of family court or divorce proceedings.

People with lower incomes who have a dispute with the IRS — an audit, a proposed tax bill, denial of a credit like the Earned Income Tax Credit, or wage garnishment for back taxes — may qualify for free help from a Low Income Taxpayer Clinic (LITC), which can represent taxpayers in disputes and help negotiate payment plans or ‘offer in compromise’ settlements. LITCs also help taxpayers for whom English is a second language understand their rights and responsibilities under the tax code. You do not need to already be in litigation to get help — many disputes can be resolved directly with the IRS before it escalates.

New York’s small claims court is designed for people to resolve money disputes without a lawyer, quickly and inexpensively. As of 2026, the claim limit is $10,000 in NYC Civil Court, $5,000 in City Courts elsewhere in the state, and $3,000 in Town and Village Justice Courts outside cities — check your local court’s current limit before filing. Filing fees are low (typically $15-$20), and either side can bring a lawyer if they want, though many people represent themselves. If you win, the court gives you a judgment, but collecting on it is a separate step — the court doesn’t automatically collect the money for you.

Choosing a business structure (sole proprietorship, LLC, corporation, or nonprofit) affects your personal liability, taxes, and paperwork requirements. An LLC or corporation generally shields your personal assets from business debts and lawsuits, while a sole proprietorship does not. In New York, forming an LLC requires filing Articles of Organization with the Department of State and publishing notice of formation in two newspapers (a step often overlooked, and one that can affect your LLC’s ability to sue in New York courts if skipped). A business law clinic or small business legal services organization can help you choose the right structure and stay compliant with ongoing filing requirements.

Starting a nonprofit in New York involves incorporating with the NY Department of State as a nonprofit corporation, then applying separately to the IRS for federal 501(c)(3) tax-exempt status (this is a distinct step from state incorporation). New York also requires most nonprofits that solicit donations to register with the NY Attorney General’s Charities Bureau and file annual financial reports, with additional audit requirements once revenue crosses certain thresholds. A nonprofit legal clinic or pro bono business law program can help with formation documents, bylaws, and understanding ongoing compliance obligations.

As of 2026, FinCEN significantly narrowed the federal Corporate Transparency Act’s beneficial ownership reporting rule so that most U.S. companies and U.S. persons no longer have to report; only certain foreign companies registered to do business in a U.S. state currently must file. Separately, New York’s own LLC Transparency Act took effect January 1, 2026, and requires most LLCs formed or registered in New York to disclose beneficial ownership information to the state (with some exemptions for larger, already-regulated companies). Because federal rules on this topic have changed multiple times through litigation and agency action, and New York’s rule is new, business owners should confirm current requirements with an attorney or accountant rather than relying on older guidance.

Surrogate’s Court is New York’s specialized court that handles wills, estates, and guardianship matters — including probating a will, administering an estate when someone dies without a will (intestate), contesting a will, and appointing a guardian for a child or incapacitated adult. If a loved one dies without a will, New York’s intestacy laws determine who inherits and in what shares, which often surprises families who assumed a spouse or partner would automatically receive everything. Estate and Surrogate’s Court matters can be handled without a lawyer for very small or simple estates, but contested matters, guardianships, and larger estates usually benefit from an attorney — free or low-cost legal clinics exist in many counties for people who qualify.