Taking the Means Test

Qualifying for Chapter 7

With the passage of the 2005 Bankruptcy Reform Act, individuals seeking bankruptcy protection are now required to take the means test. The purpose of the test is to establish your eligibility for a Chapter 7 bankruptcy, the liquidation on non-exempt assets to pay creditors. After the proceeds of the liquidation have been distributed in a Chapter 7, any remaining debts are discharged. During the first part of the test, your income is compared to the average income of a similar size household in your area. If your income is less than a household of the same size and location, you continue on to the second part of the test which determines your disposable income. Your disposable income is calculated by subtracting your monthly living expenses from your current monthly income (CMI). Types of living expenses that can be deducted include:

• House or rent payments
• Food
• Clothing
• Utilities
• Child care
• Transportation

If you have enough money to pay your creditors, you must file for bankruptcy under Chapter 13, the restructuring of creditor payment plans. The means test can be administered by a Long Island bankruptcy lawyer from Blutter & Blutter, who can ensure all of your living expenses are properly catalogued and deducted. The firm has over 50 years of combined experience assisting individuals with a wide spectrum of legal issues, including bankruptcy. They are highly proficient in bankruptcy law and can explain the various phases of the bankruptcy process.

Long Island Bankruptcy Attorney

Before you can file a bankruptcy petition, you must take the means test to determine your qualifications for Chapter 7. Lawyers at the firm have helped may people in a financial bind eliminate their debts through bankruptcy. They are trusted and compassionate legal professionals that provide personal service to their clients. When you are a client of the firm, you will always work directly with an attorney, not a paralegal or secretary. The firm can address any legal matter regarding your finances, regardless of its complexity. They can also be relied on for unyielding and determined representation throughout your case.

Contact a Long Island bankruptcy lawyer for proven representation if you are overwhelmed by debts.