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Through these activities the U.S. Trustee has achieved a regulatory system that Congress and most creditor-friendly commenters have consistently espoused, i.e., a formal means test for Chapter 7. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 has clarified this area of concern by making changes to the U.S. Bankruptcy Code ...
Thus, the means test is a formula designed to keep filers with higher incomes from filing for Chapter 7 bankruptcy. These filers may use Chapter 13 bankruptcy to repay a portion of their debts, but may not use Chapter 7 to wipe out their debts altogether. [8] The bankruptcy means test is complex and the terms that govern many parts of it ...
BAPCPA restricted the number of debtors that could declare Chapter 7 bankruptcy. The act sets out a method to calculate a debtor's income, and compares this amount to the median income of the debtor's state. If the debtor's income is above the median income amount of the debtor's state, the debtor is subject to a "means test." [2]
You must have an average monthly income lower than the median income for your state or pass a means test. ... Once you move forward with Chapter 7 or Chapter 13 bankruptcy, four possible scenarios ...
Chapter 7 is generally available to lower-income individuals who pass a means test. If you earn more than the threshold, you may be directed to Chapter 13 instead.
Filing Chapter 7 after Chapter 7: Eight years. Filing Chapter 13 immediately after Chapter 7 is also referred to as Chapter 20 bankruptcy. You won’t receive a discharge when filing Chapter 20 ...
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