A nonprofit startup is tackling what consumer advocates say is the biggest barrier that financially struggling people face in their efforts to get a fresh start: the surprisingly steep cost of bankruptcy.

The founders of Upsolve have created a TurboTax equivalent for bankruptcy designed to help people with basic financial problems—such as mounting medical or credit-card debt—pull together information for a chapter 7 filing without having to pay for a lawyer. The idea, says Rohan Pavuluri, a Harvard University student and...