Means Test issues

File Your Bankruptcy by the End of the Month or Start the Process Over
If you read this blog and other consumer bankruptcy blogs like Scott Riddle's Georgia Bankruptcy blog or the Bankruptcy Law Network blog, you know that preparing for filing a case involves a great deal of effort on your part to collect information and documents. Are there any steps that you as the potential bankruptcy debtor can take to speed up the process and to keep costs down. (…)

Chapter 7 and Middle Class Debtors
Over the past few weeks, I have received several emails from potential clients that begin with lines like "my salary is over $100,000 and I need to file Chapter 7 to protect myself against lawsuits from credit card companies" or "together, my wife and I earn well over $100,000 but we need to file Chapter 7 because…."

In each of these cases, I have had to respond to the prospective client with the bad news that about 99% of the time, Chapter 7 is not going to be available to an individual or couple whose household income exceeds $100,000. Why? Under the current bankruptcy law, something called a "presumption of abuse" arises is your gross household income exceeds the "median income" for a similarly sized family in the State where you live. (…)

Will Your Income Tax Refund Count in a Means Test Calculation?
I am considering chapter 7. I am not sure about the median income info because I am no longer employed and working a temp job and used my retirement to live on. (…)

New Median Income Table Goes Into Effect as of October 15, 2007
The United States Trustee's Office has released new median income/means test numbers applicable to bankruptcy cases filed on October 15, 2007 and thereafter. The new median income table for bankruptcy cases can be found by clicking on the link. (…)

Top Time Wasters in the Bankruptcy Process
If you have read my blog at all, you know that I have been quite critical of many of the changes brought about by the BAPCPA changes to the bankruptcy law. In general these changes have make the process of filing bankruptcy more complicated and more expensive. Sometimes, I have to decline representation in cases with complications because the potential client cannot afford to pay me for the time it would take to untangle his/her mess. (…)

Can Unemployed Wife File an Individual Bankruptcy?
Can my wife file for BK on her own? She has about 80k in credit card debt. We are together on a couple of other credit cards and our house mortgage. What is the effect on me…if any? (…)

Five Years is a Long Time for Rice and Beans
The October, 2005 changes to the Bankruptcy Law have forced many debtors into five year Chapter 13 plans. (…)

Can I File Bankruptcy Without Involving My Spouse?
If you are married, can you file an individual Chapter 7 or Chapter 13 and not include your spouse? (…)

Budgets in Bankruptcy Cases Must be Based on Real Numbers
One of the trends I have noticed over the year and a half since the bankruptcy law changed is that we can no longer rely on guesses or estimates when it comes to creating a budget. My experience in a recently filed case illustrates this point. (…)

Is Husband of a Disabled and Judgment Proof Wife Liable for Her Debts?
My wife has about $13,000 in debt from a credit card that she held before we were married (no joint use, etc.). She is now disabled and has not paid on this account for over 4 years. Creditors filed a civil suit just yesterday for repayment and legal fees of over 3k. Am I liable for this debt? What can she do to discharge the debt since she is disabled and will not earn an income? She is not a joint account holder on any family accounts (mortgage, other ccs, etc.) Thanks for your insight! (…)

401(k) Loan Repayments Not Allowed in Means Test Calculations
Evidence continues to mount that Chapter 7 will not be a friendly place for debtors who end up in the means test. As you know, you can only qualify for Chapter 7 if (1) their household income falls below the average income for a similarly sized family in your State, or (2) if your household income exceeds the average income, but you pass the "means test."

The means test sets out a budget using expense numbers that the IRS has deemed "reasonable." If your actual expense for a particular category exceeds the IRS number, too bad. (…)

Chapter 13 Plan Strategies for Self Employed Debtors
With an increased emphasis in the new Bankruptcy Code upon a debtor's income history, self-employed or commissioned sales debtors will find a hostile reception in Chapter 13. A recent case on which I have been working illustrates the problem. (…)

Are Debtors Stuck With their Form B22 Means Test Budget?
Here is an issue about Chapter 13 calculations. I don't have the answer so I would appreciate any opinions, especially from any Chapter 13 trustee attorney who reads this blog. (…)

Means Test Budget Serves as an Classification Tool, Not a Budget to Be Actually Used
Having run through several means test calculations over the past few days, it struck me that a lot of the misunderstanding about both the median income test as well as the means test arises from a fundamental misunderstanding in the press and the general public about what the results of a means test really signifies. (…)

Family Car Loans May Spell Trouble in Chapter 7 Cases
Florida Attorney Jonathan Alper discusses in his Florida Bankruptcy blog several important considerations if you are thinking about turning to a family member to help you buy a car prior to filing bankruptcy. In a scenario I have seen on occasion, Jonathan describes meeting with a client who had asked his parents to help him buy a car. The parents bought the car, but titled it in the debtor (son's) name and never recorded a lien to secure their loan to the son. (…)

Am I Allowed to Include in my Means Test Calculation an Allocation for Payments to Secured Creditors When I am Surrendering the Collateral?
Thans to Judge Homer Drake, we have an answer to this question in the Northern District of Georgia. In the Walker case (2006 Bankr. LEXIS 845, Case No. 05-15010 (Bankr. N.D. Ga. (…)

Means Test Musings
Over the past few weeks, I have received objections in two Chapter 7 cases from the U.S. Trustee having to do with the median income/means test Form 22A. (…)