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What is the Chapter 7 means test?, P.2

Last time, we began speaking about the Chapter 7 means test, and the specific forms that relate to the means test which must be filled out by debtors pursuing a filing. We’ve already spoken about Form 22A-1, which aims to determine whether the debtor’s income falls in relation to the median income in his or her state.

If the debtor’s income is determined to be above the median, they will have to fill out Form 22A-2, which is the means test, properly speaking. The aim of the means test is to determine what amount of money the debtor has available—after living expenses and payment of certain debts—to pay other debts. If, after making these adjustments, the debtor’s income is higher than a specified amount, there is a presumption of abuse which prevents the debtor from qualifying for Chapter 7 relief, unless the debtor is able to demonstrate that special circumstances reduce his or her income or increase expenses. 

Some of the information needed to fill out these forms comes from the debtor’s own records, but other parts of it come from the IRS and the U.S. Census Bureau. One important point to make about filling out these forms is that it isn’t always entirely clear how to provide the information being asked for in the forms. For each line of the forms, the United States Trustee Program has a specified interpretation which it will use under ordinary circumstances, unless a circuit court has established a contrary interpretation.

For debtors pursuing Chapter 7 bankruptcy, it is important to get the filing correct to ensure one has the best possible chance to qualify. Working with an experienced bankruptcy attorney can be a great help, not only with the initial filing of the forms, but also for navigating the process as a whole.

Source: United State Courts, “Chapter 7 Means Test Form Instructions,” Accessed Dec. 14, 2015

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