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 of bankruptcy

• 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

By 2024, all of OV’s brick and mortar locations were shuttered, with the brand reportedly on the brink of bankruptcy. —Hannah Dylan Pasternak, SELF, 5 Dec. 2025

His campaigns spoke to the farmer facing bankruptcy, the mother who can’t put food on the table, and the factory worker watching his job be shipped overseas. —Abby Phillip, Time, 4 Dec. 2025

Sales plunged thanks to the job losses of the Great Recession, with General Motors and Chrysler ending up with bankruptcies and federal bailouts. —Chris Isidore, CNN Money, 3 Dec. 2025

In a Chapter 7 bankruptcy, unsecured debts like credit cards, medical bills and personal loans are often eligible, but student loans, recent tax obligations, child support and court fines typically cannot be discharged unless specific (and rare) conditions apply. —Angelica Leicht, CBS News, 3 Dec. 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.