Means test

Recently, I have been receiving phone calls about the means test and income levels. Whenever someone contemplates filing for bankruptcy, they have to be aware that their level of income will be taken into consideration as to whether they would qualify for filing a Chapter 7 bankruptcy case. Obviously, the lower your income the more likely you will not have any issues regarding qualification. The means test looks at a debtors prior six months of income and after calculating a yearly income figure from those six months of income, a comparison is made with the median income figure for the size family that the debtor has. If the yearly figure falls under the median income, then the debtor qualifies under the means test to file a Chapter 7 case. If the figure falls above, then the means test portion of a bankruptcy petition must be completed. When a figure exceeds the median income, does that mean a debtor is denied the ability to file? No, not necessarily. It depends on whether, after entering all of the allowed deductions from the income figure, the means test shows the ability to pay the debt. Sometimes it does, sometimes it does not. The best way to determine whether you can pass the means test is to contact a qualified bankruptcy attorney and have him or her run the numbers. Then and only then, will you know. See my post below for additional information regarding the means test.