The Law Offices of Rob R. Nichols

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The Law Offices of Rob R. Nichols

To put it simply, the means test is an examination of your past six months of income minus certain allowable expenses (allowable expenses will be different from your real expenses). It is used to determine whether you qualify for chapter 7, or, if you are filing a chapter 13 to determine the length of your repayment period and to assist in determining the amount of your monthly payment.

Is The Means Test Used Just For Chapter 7 Bankruptcy Or Will I Have To Qualify Under The Means Test For A Chapter 13 As Well?

In a chapter 7 analysis, the means test is used to assist in determining whether you qualify to file. Under chapter 13 it is used to assist in determining the amount of your monthly payment and the length of the plan.

How Do My Children Count In The Means Test?

They are included in the number of people in your household, which in turn affects the amounts of various living expenses deducted from your income.

What Expenses Are Allowed In The Means Test?

Nearly all living expenses for most people are allowable expenses, many of which are based on IRS guidelines. Other expenses specific to your case may also apply, such as some back taxes, child or spousal support and any arrears, and car loans. There can also be special circumstances that apply in your case.

What Is The Marital Deduction Adjustment?

This may apply where only one spouse files for bankruptcy the other spouse maintains separate finances.

What Do I Do Next If I Want To Move Forward And File For Bankruptcy If I Have Passed The Means Test?

The means test is only one part of the overall analysis in deciding whether you are a good candidate for bankruptcy. There are many other matters to take into consideration, such as your anticipated future income and your assets. The topic of assets can sometimes be very tricky if not treated the right way, even if you think you are broke. Some assets are not obvious, such as royalties, residuals, inheritances, personal injury cases, etc.

If I Failed The Means Test For Chapter 7, Can I Still Look At Filing A Chapter 13?


For more information on Means Test In A California Bankruptcy, a free initial consultation is your next best step. Get the information and legal answers you are seeking by calling (818) 430-2526 today.

Rob R. Nichols

Call Now For A Free Initial Case Evaluation
(818) 914-4741