bankruptcy

noun

bank·​rupt·​cy ˈbaŋk-(ˌ)rəp(t)-sē 

plural bankruptcies

1

: the quality or state of being bankrupt

2

: utter failure or impoverishment

Synonyms

• ruin
• failure
• insolvency

Examples of bankruptcy in a Sentence

The company is facing bankruptcy.

The company was forced into bankruptcy.

The number of bankruptcies was especially high last year.

Critics view the decision as an example of moral bankruptcy on the part of the administration.

Recent Examples on the Web

The documentary was completed prior to Joel’s recent diagnosis of normal pressure hydrocephalus, but there are candid assessments of other struggles he’s endured, including depression, bankruptcy and alcoholism. —Melissa Ruggieri, USA Today, 25 July 2025

Since emerging from bankruptcy, the company has overhauled its menu—streamlining offerings by 20% while adding new items like Lobster Pappardelle Pasta, Bacon-Wrapped Sea Scallops, and revitalizing favorites including hush puppies and popcorn shrimp. —Nick Lichtenberg, Fortune, 25 July 2025

The discount airline, which has its corporate headquarters in Dania Beach, exited Chapter 11 bankruptcy in March and has been focused on streamlining its services and broadening its focus on guest services. —Lauren Brensel, Sun Sentinel, 23 July 2025

Businesses with limited credit, recent tax liens or past bankruptcies may still qualify. —Raymond Grand, Forbes.com, 23 July 2025

Word History

First Known Use

circa 1634, in the meaning defined at sense 1

Phrases Containing bankruptcy

• declare bankruptcy
• file for bankruptcy
• in bankruptcy

Kids Definition

bankruptcy

noun

bank·​rupt·​cy ˈbaŋ-(ˌ)krəp-(t)sē 

plural bankruptcies

: the condition of being bankrupt

Legal Definition

bankruptcy

noun

bank·​rupt·​cy ˈbaŋ-ˌkrəp-sē 

plural bankruptcies

1

: the quality or state of a bankrupt

filed for bankruptcy

2

: the administration of an insolvent debtor's property by the court for the benefit of the debtor's creditors

the debt was discharged in bankruptcy

bankruptcy proceedings

see also adequate protection, Bankruptcy Code compare insolvency, receivership

Note: Bankruptcy protects the debtor from debt collection by creditors. A debtor may file for bankruptcy, which is called “voluntary bankruptcy,” or a creditor may petition the court to declare the debtor bankrupt, which is called “involuntary bankruptcy.” Involuntary bankruptcy is allowed only under chapter 7 or chapter 11 of the U.S. Bankruptcy Code. There are four types of relief available to individuals or corporations under the Bankruptcy Code: liquidation (chapter 7), reorganization (chapter 11), debt adjustment for a family farmer or fisherman (chapter 12), and debt adjustment for an individual with a regular income (chapter 13). Municipalities may file for bankruptcy under chapter 9. The court determines which debts are to be repaid according to their priority, and the debtor is typically granted a discharge from unpaid debts that are dischargeable under the Bankruptcy Code.