Phone Call Us 414-326-9231
Toll Free 866-678-9352
Text Us 414-277-7742

What is the Chapter 7 means test?, P.1

We spoke in out last couple posts about how a debtor’s income can impact debt relief both outside of bankruptcy and within bankruptcy itself. As we noted, a debtor’s level of income can affect whether or not he or she is able to successfully keep up with monthly payments negotiated with debtors, as well as whether the debtor qualifies for Chapter 7 relief and what a debtor’s repayment plan will look like in Chapter 13 bankruptcy.

In Chapter 7 bankruptcy, the means test is the tool by which bankruptcy courts determine whether a debtor is eligible for Chapter 7 relief. The idea behind the means test is to prevent abuse of Chapter 7 bankruptcy by those who have an ability to pay back some of their debts.

When a debtor files for Chapter 7 bankruptcy, he or she is required to enter income and expense information, and make certain calculations based on the information that has been entered. The forms relating to the means test are 22A-1 and 22A-2. Together, these forms determine whether a debtor’s income and expenses create a presumption of abuse which could prevent the debtor from obtaining Chapter 7 relief.

Form 22A-1 comprises what is called the Chapter 7 Statement of Your Current Monthly Income. Debtors first fill out this form to determine whether their monthly income is more than the median income for households of the same size in their state. If not, there is no presumption of abuse and the debtor does not have to fill out Form 22A-2.

In our next post, we’ll continue this discussion and look at Form 22A-2, which deals specifically with the Chapter 7 means test. 

No Comments

Leave a comment
Comment Information

Contact Our Milwaukee Law Firm

Reach Miller & Miller Law, LLC, online or call us at 414-326-9231 to schedule a free initial consultation. Our law office also provides Spanish language services. Se habla español.

To schedule an initial consultation, call 414-326-9231 or contact Miller & Miller today.

Free Case Evaluation

* indicates required field

Milwaukee Office
633 W Wisconsin Ave, Suite 500
Milwaukee, WI 53203

Phone: 414-312-6581
Fax: 414-277-1303
Milwaukee Law Office Map

Kenosha Office
6123 Green Bay Road
Suite 210
Kenosha, WI 53142

Phone: 262-326-1669
Kenosha Law Office Map

Brookfield Office
200 S. Executive Drive
Suite 101
Brookfield, WI 53005

Phone: 262-261-0665
Brookfield Law Office Map

Madison Office
2810 Crossroads Drive
Suite 4001
Madison, WI 53718

Phone: 608-260-7133
Madison Law Office Map

Glendale Office
6001 N. Green Bay Avenue
Glendale, WI 53209

Phone: 414-973-8662
Glendale Law Office Map

Appleton Office
4321 W. College Ave.
Suite 200
Appleton, WI 54914

Phone: 920-280-3838
Map & Directions