Do I qualify for bankruptcy?
To figure out if you qualify for bankruptcy you have to take and pass a means test. To pass the chapter 7 means test your average gross monthly income, minus “reasonable and necessary” living expenses, must be below a certain threshold. If you have too much “disposable monthly income” the law says you have to repay some of your debts in chapter 13 bankruptcy.
A few things about the means test. Many of the so-called reasonable and necessary living expenses are fixed by law using census bureau and IRS living standard figures. If you actually spend more, tough luck. You only get a deduction for the fixed amount.
In addition, the means test favors people with car loans and mortgages, because the means test allows you deduct payments on secured debts like these. So, two people can earn the same amount of money, and have the same household size, and one may pass the chapter 7 means test, and the other may not.
Get help with the chapter 7 bankruptcy means test today (562) 479-0939.