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In the year 2005, the US government reconstituted bankruptcy laws for the betterment of the society. Earlier the bankruptcy laws for filing bankruptcy were not as effective and the creditors were not really satisfied with the ease given to the debtors. The easy process of filing for bankruptcy had made people careless towards their monetary obligations in the long run. The present laws for bankruptcy had restricted the filling of bankruptcy under chapter seven to a great extent. Earlier the filling of bankruptcy was done at the discretion of the filer, irrespective of his income. Amended law of bankruptcy has restrained the filling of bankruptcy for people with high income. The new law has restricted bankruptcy lawyers too from representing their clients in their bankruptcy cases. According to the new law of bankruptcy the debtors are also asked to report about their total income and also a detailed report of their expenditures before and after filling their bankruptcy case.