What is means test in bankruptcy context? Simply put, it puts a threshold on the amount of money you can make and qualify for a chapter 7 bankruptcy. The means test is an aritifical amount that is based on the median income in your geographic area. In Erie and Monroe county, New York and all surrounding areas, the means test is as follows and is based on the number of dependents in your home.
Household of 1 $46,485
Household of 2 $58,109
Household of 3 $69,421
Household of 4 $82,457
For each additional household member, add $6,900.
The bankruptcy means test look at your last six (6) months of gross income. Then multiples that avg. monthly income over a year to arrive at the numbers listed above. These figures are updated every 6 months. Most people I represent don't have an issue with qualifying for a chapter 7 bankruptcy. Prior to the 2005 bankruptcy reform act, the trustee's office did review the filing and would object to a chapter 7 petition if the income was thought sufficient to pay back something to creditor's in a chapter 13 setting.
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