The Bankruptcy Means Test

There is a great deal of confusion and misinformation about the bankruptcy means test and what it is intended to do. Many people mistakenly believe that the means test is used to disqualify people from eligibility for bankruptcy. In fact, the primary purpose of the means test is to determine which bankruptcy chapter you are eligible to file under.

Prior to the 2005 changes in the bankruptcy laws, there were a number of Chapter 7 filings that were considered abusive because it was suspected that the petitioners made enough money to repay at least a portion of their debts. The means test seeks to prevent these types of abusive Chapter 7 filings.

Experienced New Jersey bankruptcy lawyer Joel Spivack can assist you with your bankruptcy filing. Call him day or night to discuss your situation.

How the Means Test Works

The first step of this process involves comparing your income level with the median income level of other wage earners in your state. If your income is higher, you will proceed with the means test. All allowable expenses are subtracted from your monthly income, and the resulting net income amount is entered into a formula that determines Chapter 7 eligibility.

If it is determined that you are not eligible for Chapter 7, you may challenge the finding so long as you are able to present sufficient evidence to support it. If the finding that you are not eligible for Chapter 7 is confirmed, you are, in all likelihood, still eligible to file for bankruptcy under Chapter 13.

Speak to a New Jersey Bankruptcy Qualification Lawyer

I am bankruptcy attorney Joel R. Spivack. I invite you to visit my Cherry Hill office for a free, in-person consultation to discuss your financial situation and the debt relief options that are available to you. My regular business hours are 8 a.m. to 5 p.m., Monday through Friday. Free parking is available. You can reach me by phone at 856-488-1200 . You can also contact me via e-mail.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.

We are here to help you.

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Attorney Joel R. Spivack is an experienced bankruptcy and residential real estate transactions lawyer in Cherry Hill, New Jersey. Clients come to us for legal services, but what we really provide is peace of mind. For more than 30 years, Attorney Spivack has helped people make wise, informed decisions about bankruptcy filings, debt relief options and residential real estate transactions.
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