The days of using personal bankruptcy as a personal financial planning tool are quickly coming to an end. With the Republicans in control, the U.S. Congress has rammed through legislation that will overhaul the bankruptcy laws which will make it more difficult for U.S.consumers to walk away from personal debts. President Bush has already indicated he will sign the legislation after a few minor changes are finalized. The law will go into effect six months after the presidential signature. The new bankruptcy laws will require an income test and credit counseling for all individual filers. Consumers with sufficient income to pay part of their debts will be prevented from wiping out all personal debts in a Chapter 7 filing. The proposed law will also set a $125,000 cap on the amount of home equity that can be exempted from liquidation. However President Bush is opposed to this stipulation. The House must either approve the Senate version of the Bankruptcy Reform Act, or make changes in it and send it back to avoid having to negotiate the differences between the two versions. The U.S. Senate overwhelmingly approved the bankruptcy reform bill last Thursday by a vote of 83-15. The U.S. House passed its version of the legislation on March 1. The House approved H.R. 333 by a 306 - 108 vote. It is expected that a surge of filings will be made prior to the law's enactment.