According to AIS bankruptcy filing data, U.S. bankruptcies totaled 52,074 in August, down 2,680 from July and up 4,119 from August 2025, an 8.59% year-over-year increase.
June and July both rose against their seasonal patterns. August moved in the opposite direction, falling 4.89% from July in a month that has averaged a 4.33% increase from July over the past 20 years. Even so, at 52,074 filings August posted the highest total for the month since 2019 and came in 8.59% above last year, keeping the filing environment at a level well above where it was twelve months ago.
The stabilization in the Chapter 7 share that emerged in June and July showed a slight reversal in August.
Chapter 7's share of consumer filings ticked back up to 64.8% in August from 63.6% in July. It's a modest move, but two months of stabilization followed by an uptick means the chapter mix story isn't as settled as June and July suggested. Chapter 13 held at 37.4%, its highest level since January.
Subchapter V is the number that stands out most in August. At 295 filings, it was up 58.6% year over year, a sharp acceleration from the growth seen in prior months. Subchapter V is designed to give small businesses a more accessible path to reorganize rather than liquidate. The August increase therefore deserves a different interpretation than a comparable rise in Chapter 7 filings, but the acceleration is still worth watching.
Through eight months, 2026 filings total 417,463, running 11.53% above the same period in 2025. The full-year base case sits near 628,000, approximately 11% above 2025's 566,230 and roughly 17% below the pre-Covid annual average of 760,000.
August's pre-Covid gap came in at 23.13%, wider than July's 12.63% and the widest monthly gap of the year. August ranked in the top three months of the year in 2016, 2017, and 2018, running between 68,192 and 68,547 filings in those years. In the current environment it ranks fifth among the eight months completed in 2026.
The top ten states in August:
Nine of the top ten states posted year-over-year growth above the national pace of 8.59%. Texas led at 22.0%, followed by Florida at 21.0% and Georgia at 15.2%. North Carolina, while not in the top ten by volume, posted the strongest growth rate among states with meaningful volume at 22.4%.
New York is the exception that's becoming a pattern. At 4.5% year-over-year growth, it's the only top ten state running below the national average for the second month in a row. The divergence between New York's measured pace and the acceleration visible across the South and mid-Atlantic is worth monitoring as the year closes out.
What happened in Jackson Hole may have been the most defining economic moment of August. Fed Chair Warsh's August 28 address delivered the clearest signal yet of where the Fed stands: "We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed. Otherwise, we have work to do." He avoided any forward guidance and argued the Fed should be quieter, letting incoming data drive decisions. Markets heard the message. Odds for a rate hike at the September 15-16 meeting jumped to 66.1%, nearly double where they were before Warsh spoke, according to CME Group's FedWatch.
The July inflation data gave Warsh's position context. The Fed's preferred measure, PCE inflation, stood at 3.7% year over year, well above its 2% target, while core PCE came in at 3.3%. Warsh made clear that the Fed needs to see underlying inflation moving toward its objective at a sufficient pace before declaring the job done. That leaves additional tightening on the table and keeps borrowing costs an important part of the economic backdrop heading into the fall.
The New York Fed's Q2 2026 Household Debt report, released August 11, delivered a mixed picture. Total household debt dipped slightly to $18.8 trillion, while overall serious delinquencies also edged lower. Those are genuine improvements. But auto loan balances reached $1.71 trillion and credit card balances climbed to $1.26 trillion, while early delinquency transitions increased slightly for auto loans and mortgages. The NY Fed also noted that elevated credit card delinquency levels continue to reflect, in part, borrowers who entered delinquency several quarters ago rather than a sharp increase in new defaults. The overall picture improved, but pockets of household credit stress remain.
Foreclosure activity continues to build from last year's levels, although volumes remain relatively low by historical standards. ATTOM reported 39,906 properties with foreclosure filings in July, up 1% from June and 10% year over year. Foreclosure starts rose 10% from a year ago and completed foreclosures increased 23%. Texas led REO activity with 1,265 completed foreclosures, consistent with its position as one of the fastest-growing bankruptcy filing states. While foreclosure activity remains well below historical peaks, the continued year-over-year increase is another indicator worth watching alongside Chapter 13 filing trends.
August fell from July in a month that historically rises, yet still posted the highest August total since 2019 and came in 8.59% above last year. Through eight months, 2026 filings are running 11.53% above the same period in 2025 and the full-year base case remains near 628,000, approximately 11% above 2025. The filing environment is elevated and has been holding there consistently, even in a month that gave back some of July's volume.
The economic backdrop does little to suggest that filing pressure will ease materially in the near term. Inflation remains above the Fed's target, borrowing costs could move higher, household debt remains elevated and foreclosure activity continues to rise from last year's levels. None of those conditions guarantees higher bankruptcy filings, but together they provide little reason to expect the upward year-over-year trend to reverse as 2026 enters its final four months.
Data sourced from the AIS proprietary bankruptcy database, compiled daily from U.S. court records (PACER) since 2000.