When you file bankruptcy your income will help in determining which chapter you qualify for. You and your attorney will look at both the means test and disposable income.
To determine which chapter you file your attorney will calculate your income for the means test. This calculation looks at gross income over the six months before the month of filing. Your attorney will use income from most sources- for example, child support, wages, alimony, unemployment, bonuses, overtime, contributions to your household, etc. Each state has its own set of median income you would need to be under in order to either file a three year chapter 13 or a chapter 7 case. In Minnesota for a household of 1 it is $72,319; household of 2 is $93,855; household of 3 is $117,426; and household of 4 is $141,903, then for each dependent after you add $9,900. If your income is above these threshold numbers, you may need to look at filing a chapter 13 five year plan bankruptcy.
Income is also used in your case to determine disposable income, after all of your reasonable and necessary expenses are paid. If you have enough disposable income at the end of the month to pay your creditors, you may need to look at a chapter 13. Your attorney will help you review your budget and income.
To qualify for a chapter 7 bankruptcy you have to meet two tests for income, whether you pass the means test for your household size and whether you have disposable income at the end of the month.
CALL NOW FOR A FREE STRATEGY SESSION FROM AN MN BANKRUPTCY LAWYER AT LIFEBACK LAW FIRM
If you have questions about bankruptcy and would like to do a free consultation to go over your options, visit www.lifebacklaw.com to speak with an attorney. You will be glad you did!
