Means Test

[karm43]

Has anyone been over the means test and still was approved for a chap 7?

[debee]

Do you mean over the median income & still file and discharge in a ch7? If you do, the answer is yes.

Do you mean failed the means test but still got a chapter 7 discharge? If you do, then the answer is also yes - but only in cases where there were special circumstances.

[karm43]

The first 1 when i do the second part i pass. thats not listing any collectors. my house 2 cars and irs standards. Hope im doing it right, I know talk to a attorney but getting prepared.

[karm43]

Have less then 100 left

[buffetbuster]

We had about $50 left and our attorney said he would be doing us a big injustice if we didn't file CH7. He's been practicing BK for a long time and has never lost a CH7 case and said that we are a prime candidate for it. We haven't had any objections as of yet. My 341 is July 1, so I'll keep you posted.

[karm43]

Thanks

[sunshinepa]

Hi Karma.

You should be fine. Here in PA, I think you need 117.00 left to be in a CH 13. Also, there are things not on the means test which will make your DMI even lower if you put it under other expenses. Example are: pet care, over the counter meds and I don't think ( not positive) entertainment was there either. You are allowed all those things. Make sure you are using a current means test ( I had seen some that were not updated with the new allowances).

Your should discuss your expenses with you and maybe find others or make some higher because they know the trustees. Mine put most of my expenses so high, I was a nervouse wreck. There was no reason as I was okay with the standards. The trustee never blinked an eye.......whew!

Keep us posted.

[debee]

I was over the median and passed the Means Test. Don't include any debt that you intend to discharge as an expense with the exception of your house and cars.

NOLO's Means Test is a good one. You can also get the UST's line-by-line document on its position on the Means Test here -----> http://www.justice.gov/ust/eo/bapcpa/index.htm It's the pdf on the left. Just scroll down. The info it gives on the car expense is no longer accurate. You can't claim an "ownership expense" if you don't have a payment. That changed with the Ransom case.

Good luck.

[overthedebt2]

My attorney never even mentioned the "Means Test". Does this mean my income is well below to qualify for Ch 7? After dischargeable expenses (all credit cards), on paper I do have a lot of disposable income. I'm really confused now.

[debee]

My attorney never even mentioned the "Means Test". Does this mean my income is well below to qualify for Ch 7? After dischargeable expenses (all credit cards), on paper I do have a lot of disposable income. I'm really confused now.

You can find out if you pass the Means Test here ------> http://www.legalconsumer.com/bankruptcy/nolo/

Since your attorney didn't mention it, you are probably below median. The median varies by state and household size. If you go to the Means Test link, you will be able to enter your information and see where you stand.

Generally speaking, you don't want to have disposable income on your schedule I/J. It's best to keep it under $100. As sunshinepa pointed out, if you have as little as $117 you can end up having your chapter 7 dismissed. It depends on the amount/type of your debt.

[overthedebt2]

Thanks debee! I followed your link. Yes, I'm well below the median. Right now, I have NO disposable income if I pay all my minimums. All my debt is unsecured though. Do I still have to show what my "disposable" income would be after the cc debt is discharged? I'm just confused now.. my attorney made it seem like CH 7 would be no problem. Ch 13 wasn't even mentioned..

[debee]

If your attorney is confident, then I think you are probably fine. She/he will guide you on the expenses. Do not include your debt when you calculate your expenses.

If you want to take a closer look yourself, you can go to this site and print the forms. You want B6I and B6J. ---->http://www.uscourts.gov/FormsAndFees...ptcyForms.aspx

When you calculate your income/expenses, do not include any debt that you hope to discharge. Include your living expenses as if the debts did not exist. You only include debt you intend to keep (for most people this is house & car). When you are calculating your expenses, you want to stay under the national standards unless you can document a need to be above the standard and it's both reasonable and necessary. An example would be medical - if you spend more than the standard on medical because of req'd prescriptions & equipment, it's both reasonable and necessary. If you have a $250 per month premium cable package, the trustee will object and your chapter 7 could be dismissed.

You can see the standards based on your county at the Means Test link.

You can see the national standards broken down by category here ---> http://www.justice.gov/ust/eo/bapcpa..._standards.htm

It all comes down to disposable income. You don't want to have enough to fund a chapter 13.

[overthedebt2]

Thank you so much. You are such a great help! As far as expenses, are the state standards used as deductions or what you actually PAY? Right now, all I can afford is a ROOM in someone's home. So clearly right now, my "expenses" are quite low. However, the state standards are obviously MUCH higher.

[overthedebt2]

debee,

I followed your link. So, it says $ 4,124 = Total Standard Monthly Expense Deductions for a household of two. Median Income is $62970 or less and we earn $4333 a montyh BEFORE taxes.

I'm just confused by the "Total Monthly Expense Deductions". Clearly I can't afford that right now which is why I'm essentially renting a room to make ends meet. Do they use the "Standard Monthly Deductions" for housing, food, etc or what I'm paying NOW in my current situation?

[debee]

You can't claim a rent expense (up to the standard) if you're not actually paying it.Your fixed expenses (rent, car ) should be actual. You may have some variable expenses like phone (if you don't have a long distance plan and Grandma is living in Anchorage), or utilities. Those expenses should be averages. You have some wiggle room on things like food, medical, household. You can increase those.

Once you stop paying your cards, you'll free up some money. Sometimes it's possible to file while renting a room using a higher housing expense, but that normally requires a signed lease or rental agreement. Best thing is to run your numbers and if it it's not working out, don't worry or give up. Just do more reading, post about it and try again. The important thing is to have it worked out before you file.