Do I Qualify? - The Means Test

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Below we have provided answers to many of the common questions that we are asked by our clients regarding qualifying for bankruptcy. For example, in order to qualify for a Chapter 7 bankruptcy you must pass the Means Test (either part A or part B). A Part A Means Test Calculator is provided below. Even if you fail Part A read on because you may qualify under Part B. If you would like more information please do not hesitate to call us at 508.655.5980 or e-mail us.

Means Test Calculator

Filing Date:	Please Choose ----------------- 3/15/11 - 10/31/11 On or After 11/1/11
State or Territory:	Please Choose ----------------- Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Dist of Columbia Florida Georgia Guam Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Northern Mariana Isl Ohio Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island South Carolina South Dakota Tennessee Texas The Virgin Islands Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming
Family Size:
Monthly Household Income (avg of last 6 mos.):	$
Median Family Income for your family size:	$
RESULT:

The Means Test Calculator provided above uses median family income figures for each state (for filings prior to November 1, 2011 the median family income figures are as of November 1, 2010; for filings on or after March 15, 2011, median family income figures are as of November 1, 2010 ). These figures are subject to change and the Calculator may not be up to date. If you are not sure what your family size is or how to calculate your monthly household income, you should consult with an attorney when using this calculator.  If your income is greater than the median income for your state of residence and family size, you still might meet the means test after taking into consideration certain expenses as defined by the Bankruptcy Code and other deductions, including regular charitable donations (up to 15% of your income), school expenses, payments on 401(k)/IRA loans, and health Insurance. Whether you are a lay person or an attorney, please do not hesitate to call Attorney Justin Kelsey at 508.655.5980 to discuss the correct use of the calculator or to schedule a bankruptcy consultation.

What is the Means Test?

The means test is a test required under the new bankruptcy law to determine a debtor's eligibility to file for bankruptcy under Chapter 7 of the Bankruptcy Code. If your income is greater than the median income for your state of residence and family size, in some cases, creditors have the right to file a motion requesting that the Court dismiss your cases under Section 707(b) of the Bankruptcy Code. It is ultimately up to the Bankruptcy Judge to decide whether the case should be dismissed.

How is the Means Test calculated?

The Means Test calculation compares your average monthly income (as calculated over the last six (6) months) to the median family income in your state for a household of your size. If your average monthly income is lower than the median family income for your state of residence and family size, then you meet the means test and there is a presumption that you may file for Chapter 7 relief. If your income is greater than the median income for your state of residence and family size, you still might meet the means test after taking into consideration certain expenses as defined by the Bankruptcy Code and other deductions, including regular charitable donations (up to 15% of your income), school expenses, payments on 401(k)/IRA loans, and health Insurance. If you are subject to this calculation Kelsey & Trask, P.C. will help you perform this task.

What is the Median Family Income for Massachusetts?

The Median Family Income for Massachusetts as of November 1, 2011 is as follows:

Family size 1: $53,496 per year
Family size 2: $64,174 per year
Family size 3: $80,337 per year
Family size 4: $99,067 per year
add an additional $7,500 per year for each additional household member.

For a list of the updated median family income figures for other states, a complete list is provided here.

Please note that these figures are subject to change and you should consult with an attorney for the current figures.

What are the debt limits for bankruptcy?

You cannot file an individual Chapter 13 bankruptcy if your debts are over $360,475 unsecured and $1,081,400 secured.

Can I file for Chapter 7 bankrupty if I filed before?

Whether or not you may re-file (and the amount of time that must pass before you may re-file bankruptcy) depends on whether or not you received a discharge under your most recent bankruptcy filing.

If you received a discharge under a Chapter 13 bankruptcy case, then you cannot file for relief under Chapter 7 unless:

1. Six years have passed since the discharge in the Chapter 13 case; or
2. You paid at least 70 percent of your allowed unsecured claims in the Chapter 13 case, and your plan was proposed in good faith and represented your best effort to pay.

If you received a discharge under a Chapter 7 bankruptcy case, then you cannot file for relief under Chapter 7 unless eight years have passed since the discharge in the previous Chapter 7 filing.

If you filed a Chapter 7 or Chapter 13 case that was dismissed because you failed to obey court orders or you voluntarily requested a dismissal and did not obtain a discharge, then you cannot file for relief under Chapter 7 unless 180 days have passed since the dismissal of the previous filing.

Can I file for Chapter 13 bankrupty if I filed before?

Whether or not you may re-file (and the amount of time that must pass before you may file bankruptcy again) depends on what chapter of the Bankruptcy Code you are filing under, what chapter of the Bankruptcy Code you previously filed under, and whether or not you received a discharge under your most recent bankruptcy filing.

You are not eligible for a discharge under Chapter 13 of the United States Bankruptcy Code if you have previously received a discharge under Chapter 7, or Chapter 11 of the Bankruptcy Code within the four-year period immediately preceding your planned filing. If you have received a discharge under Chapter 13 of the Bankruptcy Code, you may not obtain a discharge under Chapter 13 for two years after the previous Chapter 13 discharge.

If you received a discharge under a Chapter 13 bankruptcy case filed within the previous six years, you will be eligible for a discharge under Chapter 7 (and may therefore file a Chapter 7 petition) if, in the prior case, you paid at least 70 percent of your allowed unsecured claims, and your plan was proposed in good faith and represented your best effort to pay.

You are ineligible for a discharge under Chapter 7 (and therefore should not file) until eight years have passed from the discharge date obtained under a previous Chapter 7 filing.

If within 180 days before your bankruptcy you had a prior bankruptcy case that was dismissed because you failed to obey court orders or you voluntarily requested a dismissal (but did not obtain a discharge), then you may not file your bankruptcy case until this 180-day period expires.



                   Click here to learn more about what property you will keep in a bankruptcy.