What Is a Means Test and Why Is It Important?
The means test is one of several bankruptcy qualifications used to determine if you are eligible to file for relief under Chapter 7. The means test compares your income with other wage earners in your state. There are a number of steps that may be involved in completing the means test and making a final determination about your eligibility. Be sure that you talk to an experienced bankruptcy lawyer who can help you understand the process.
At the Price Law Firm, we focus our practice primarily on helping central Florida residents obtain the debt relief they need through Chapter 7 or Chapter 13 bankruptcy. We know how overwhelming it can be to work through an unfamiliar legal process, especially when you are already facing the stress of an unmanageable debt load. We will walk you through the entire process and work to ensure that your interests are protected.
Understanding the Bankruptcy Means Test
If your income is above the median of other wage earners in your state, you will need to take the means test. The means test seeks to prevent abusive Chapter 7 filings. It looks at your monthly income and takes out all applicable expenses allowed under the law. The resulting net income figure is then fed into a formula that determines whether you are eligible to file under Chapter 7.
If the formula indicates that you are not eligible for Chapter 7, you have the opportunity to challenge the finding by showing special circumstances for certain expenses or making adjustments to portions of your income, such as one-time payments or showing that a particular income stream is no longer there. Even if the finding of Chapter 7 ineligibility stands, you still have the option of converting your case to a Chapter 13.
Many attorneys do not properly apply the means test. Therefore, please talk to us, even if another attorney has told you that you don't pass. We may be able to help you.
To learn more about your bankruptcy options, contact the Price Law Firm. From our offices in Altamonte Springs in the Orlando-Kissimmee metro area, we represent clients throughout central Florida. To schedule a free consultation with an attorney, call 407-792-3473 or contact us toll free at 866-381-9243.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
