In the United States, bankruptcy is governed by federal law, commonly referred to as the "Bankruptcy Code" ("Code"). The United States Constitution (Article 1, Section 8, Clause 4) authorizes Congress to enact "uniform Laws on the subject of Bankruptcies throughout the United States." Congress has exercised this authority several times since 1801, including through adoption of the Bankruptcy Reform Act of 1978, as amended, codified in Title 11 of the United States Code and the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA).

All American bankruptcy cases are handled in federal courts under rules outlined in the U.S. Bankruptcy Code. A bankruptcy case normally begins when the debtor files a petition with a bankruptcy court. A petition may be filed by an individual, by spouses together, or by a corporation or other entity.
The individual situations and the "creditor matrix" are exceedingly important to develop, and grasp, before deciding what type of bankruptcy will be sought. In certain instances, a "deed in lieu of foreclosure" can solve a simple matter between a mortgage lender and an individual, and prevent the process from taking place. in more complex scenarios, and depending on the cash flow capability of the firm, a plan can be presented to a court wherein debt repayment is truncated as it existed before the bankruptcy filing and is totally restructured or deferred for a number of years.
Lack of liquidity can force a sale of the individual or firm's assets. Other sections of the Code address issues within bankruptcy, such as bankruptcy crimes are found in Title 18 of the United States Code (Crimes). Tax implications of bankruptcy are found in Title 26 of the United States Code (Internal Revenue Code), and the creation and jurisdiction of bankruptcy courts are found in Title 28 of the United States Code (Judiciary and Judicial procedure).
There are different types of bankruptcies, as previously noted, and they are usually referred to by the chapter in the U.S. Bankruptcy Code that affects the particular case.