I've been running the numbers and it does not look as though CH7 will be possible if my wife and I file jointly. The median monthly income for a household of two in our area is $5890. Jointly we are way over at $8249. Using that figure I completed the means test and we fail (presumption of abuse). However, the median monthly income for a household of one is $4922 which we both pass as our gross monthly incomes are $4833 and $3416 respectively. Does this mean that one (or both) of us should file separately? If we both filed separately would we be accused of trying to circumvent the system? What if I just filed myself? I carry the largest share of unsecured debt-if my income were able to go toward my wife's debt we could pay it off in a reasonable amount of time. Any ideas?
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Well duh...I just realized that her income does come into play if I file on my own, but when I deduct for her taxes, etc...I still pass the means test, so I think this is the option we're going to go with. At least once we pay my wife's debts off if we need to finance a car (which we'll avoid at all costs) she can purchase it since she has good credit now and will continue to have good credit after I have been discharged. -
Your household size remains two whether you file joint or only on your own. The benefit of having one of you not file, would be that you get to include her separate debts as expenses. So if she has a credit card in her name only, you can claim the monthly payment as an expense whereas if you were filing jointly and discharging that debt, you would not have it as an expense.
Not sure what you meant about financing a car post-bk. If your cars are paid off now, you might want to consider financing two new cars right now, and seeing what that does to your Means Test. Might be better to have two new cars and payments, than to carry your wife's separate debts forward undischarged and still end up needing to finance a car post-bk anyway.There are two secrets for success in life:
1.) Never tell everything you know.Comment
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Thanks for clarifying that-I actually purchased the NOLO book but that still wasn't exactly clear. By the time I file we will be a household of three (our daughter is due in October) so I'll be way under the median.Originally posted by debee View Post
My wife doesn't have that much debt really but now that I'm rethinking this a bit we may decide to wait even longer because her employment is less certain after next year. She is filling a temporary position for the 2011-2012 school year but has no guarantee of a job after that. If the economy keeps up the way its been going I'm anticipating her going on unemployment in June of 2012-six months after that we'll be far below the median income level. It's a lot to think about, but the more I do the more I see the advantage of long range (12-24 month) planning.Originally posted by debee View PostComment
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I'm sure there's a lot to consider. One bit of info that might help as you mull things over is that there is no real benefit to being "way under" the median vs. just being "under" the median when it comes to the Means Test. If you're under by $1, you don't have to take the test. Same if you're under by 20K. Either way, once you get past the Means Test (by passing or skipping it), then the test becomes your schedules I/J. If you pass there, you're good to go. Something to keep in mind as you run your numbers and determine which dates will work best for you and your family.There are two secrets for success in life:
1.) Never tell everything you know.Comment
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