The Maryland Statement of Current Monthly Income and Means Test Calculation for Use in Chapter 7 — Post 2005 is a legal document that is crucial in the bankruptcy process. This statement is used to determine whether an individual or business is eligible to file for bankruptcy under Chapter 7, which allows for the discharge of eligible debts. In the state of Maryland, there are different types of Statement of Current Monthly Income and Means Test Calculation forms used in Chapter 7 cases. These forms vary depending on the debtor's situation and whether they are an individual or a business. 1. Maryland Statement of Current Monthly Income and Means Test Calculation for Individual Debtors: This form is used when an individual wishes to file for bankruptcy under Chapter 7. It requires the debtor to provide detailed information about their current monthly income, including wages, self-employment earnings, rental income, and any other sources of income. 2. Maryland Statement of Current Monthly Income and Means Test Calculation for Joint Debtors: In cases where a married couple wants to file for bankruptcy jointly under Chapter 7, this form is used. It includes similar information as the individual debtor form but takes into account the combined income and expenses of both spouses. 3. Maryland Statement of Current Monthly Income and Means Test Calculation for Business Debtors: This form is specifically designed for businesses that want to file for Chapter 7 bankruptcy. It requires the debtor to provide detailed financial information about the business's income and expenses, including gross receipts, cost of goods sold, and monthly operating expenses. The Means Test Calculation within these forms is an essential aspect of the bankruptcy process. It determines whether the debtor's income exceeds the state's median income for their household size. If the debtor's income is below the median, they automatically qualify for Chapter 7. However, if their income exceeds the median, they must complete further calculations to determine their disposable income and potential eligibility for Chapter 7. In Maryland, these forms are highly specific and must be filled out accurately, as any discrepancies or errors can have significant consequences for the bankruptcy case. It is advisable to seek legal assistance or consult a bankruptcy attorney to ensure that all information is correctly entered, and all necessary supporting documentation is provided. Overall, the Maryland Statement of Current Monthly Income and Means Test Calculation for Use in Chapter 7 — Post 2005 is a critical part of the bankruptcy process. It assists in determining eligibility for Chapter 7 bankruptcy, ensuring that only those who genuinely need debt relief can qualify for it.
Maryland Statement of Current Monthly Income and Means Test Calculation for Use in Chapter 7 - Post 2005
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How to fill out Maryland Statement Of Current Monthly Income And Means Test Calculation For Use In Chapter 7 - Post 2005?
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To calculate your six-month average gross income, you first need to add up your wages, salaries, and tips for the past six months. Then, divide that number by six to get your average monthly income. If you receive any income from sources other than employment, you'll need to factor that in as well.
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.
Form 122A-1: Chapter 7 Statement of Your Current Monthly Income. Form 122A-1 focuses on your marital and filing status, as well as your monthly income as compared to your state's median income.
If a filer qualifies for an exception to the means test, they will file Form 122A-1Supp. 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.
The Chapter 7 means test determines whether allowing someone to discharge their debts would be an abuse of the bankruptcy system. If your gross income based on the six months before filing bankruptcy is below the median income for your state, you pass the means test.
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.
This formula takes a look at the amount of disposable income compared to the level of unsecured debt. If the debtor's disposable income, projected for a five-year period, is more than 25 percent of the total unsecured debt, the debtor will likely be denied a Chapter 7 filing.