This tool helps you determine if you qualify for Chapter 7 bankruptcy based on your income and expenses.
How To Use The Chapter 7 Means Test Calculator
This calculator helps you determine if you are eligible to file for Chapter 7 bankruptcy. Here is how to use it:
- Enter your monthly income.
- Enter the size of your household.
- Enter your secured debts (monthly payments).
- Enter your unsecured debts (monthly payments).
- The national standard is set to $500 by default, adjust if necessary.
- Enter your healthcare expenses (monthly).
- Enter any other miscellaneous expenses (monthly).
- Click “Calculate” to see the result.
How It Calculates The Results
The calculator subtracts your total monthly expenses from your monthly income to determine your disposable income, which is then used to assess eligibility:
- Total Expenses = Secured Debts + Unsecured Debts + National Standard + Healthcare Expenses + Miscellaneous Expenses
- Disposable Income = Monthly Income – Total Expenses
- If Disposable Income is below a certain threshold, you may be eligible for Chapter 7 bankruptcy.
Limitations
Please note that this calculator provides a simplified assessment and should not replace professional legal advice. Various factors including state-specific guidelines and exceptional circumstances may affect the final outcome.
Use Cases for This Calculator
Calculating Chapter 7 Means Test
Calculate your eligibility for Chapter 7 bankruptcy with the Means Test calculator. Enter your financial details to determine if you pass the means test.
Income Calculation
Input your monthly income, including wages, bonuses, alimony, and any other sources of income to determine your total monthly income for the bankruptcy means test.
Household Size Adjustment
Indicate the number of people in your household to adjust the income limits accordingly for the Chapter 7 means test calculation. The household size directly impacts your eligibility.
Deductions Evaluation
Enter allowable deductions such as rent/mortgage, utilities, health insurance, taxes, and other necessary expenses to reduce your disposable income for the Chapter 7 means test.
Comparison with State Median Income
Compare your calculated income with the median income in your state for a household of your size. Determine whether your income falls below the median to qualify for Chapter 7 bankruptcy.
Passing the Means Test
If your calculated disposable income is lower than the state median income, you pass the means test and qualify for Chapter 7 bankruptcy. Proceed to explore your options based on the results.
Failing the Means Test
In case your disposable income exceeds the state median income, you may fail the Chapter 7 means test. Explore other debt relief options or consider Chapter 13 bankruptcy as an alternative.
Seeking Legal Advice
If you are unsure about the means test results or your eligibility for bankruptcy, consult a bankruptcy attorney for expert guidance and assistance in navigating your financial situation.
Recalculating for Changes
If your financial situation changes, such as a new job or additional expenses, use the calculator to reassess your eligibility for Chapter 7 bankruptcy by recalculating your means test.
Understanding Bankruptcy Process
Use the means test calculator results as a starting point to understand the Chapter 7 bankruptcy process better. Learn about the implications, requirements, and benefits before proceeding.