Get MA Chapter 7 Bankruptcy Questionnaire 2017-2024

To determine your Chapter 7 bankruptcy income limit, add the last six months of your gross income – this is what you earned before taxes and other deductions were taken out. Divide that number by six. While that may seem like a waste of time – why not just take one month instead of adding six, then dividing by six?

The means test is calculated by comparing the debtor's average income for the past six months (current monthly income), annualized, to the median income for households of the same size in the debtor's state of residence.

Examples of nonexempt assets that can be subject to liquidation: Additional home or residential property that is not your primary residence. Investments that are not part of your retirement accounts. An expensive vehicle(s) not covered by bankruptcy exemptions.

Calculation of Current Monthly Income: To begin the means test, debtors calculate their current monthly income, which equates to twice the gross income earned in the six months leading up to the bankruptcy filing.

In the test, you compare your income with the median income of a similar size household in your state. If your income is lower, you pass the test. If it's higher, you have to move on to the next step in the means test, which takes your expenses and disposable income into account. Written by Attorney Jenni Klock Morel.

Chapter 7 bankruptcy may be denied, possibly for reasons that don't have anything to do with whether you are qualified. The road to success is full of speed bumps that include dozens of forms, requirements, rules and court orders. Miss just one and your case may be dismissed.

If your total monthly income over the course of the next 60 months is less than $7,475 then you pass the means test and you may file a Chapter 7 bankruptcy. If it is over $12,475 then you fail the means test and don't have the option of filing Chapter 7.

You can earn a high income and still pass the means test if you have substantial expenses like a hefty mortgage, multiple car payments, taxes, childcare, health care, or care of an elderly or disabled person. However, if your disposable income is more than a certain sum, you will not be able to file.