Common Mistakes Debtors Make on the Chapter 7 Means Test

Errors to Avoid So That You Qualify to Discharge Your Debts

Common Mistakes Debtors Make on the Chapter 7 Means TestIf you’re looking for a fresh start in bankruptcy and you want to be permanently rid of some of your debts, you’ll want to file a petition under Chapter 7 of the bankruptcy laws. To qualify, though, you’ll need to submit to a “means test,” whereby you demonstrate to the bankruptcy court that you lack the resources to repay your creditors over a three-to-five-year period. The means test can be complicated, so it’s best that you work with an experienced attorney to complete and submit it. There are, however, some mistakes you want to avoid, so that you don’t unnecessary scrutiny.

Take Only the Deductions You Are Allowed

Under the means test, some of your monthly payments may not be deducted from your disposable income. For example, you can’t deduct payments made into 401(k) or other retirement accounts or for college expenses for your children.

Take Only the Deductions that You Can Support with Documentation

You may actually give more to your church than your records show, but if you can’t prove it, don’t take the deduction. Without adequate proof, it can be the basis for an allegation of bankruptcy fraud.

Take All the Deductions to Which You Are Entitled

Your attorney can help you make certain that you take all the deductions allowed under the law, such as taxes and insurance not included in your mortgage payment.

Be Careful When Determining Household Size

You may be inclined to enlarge your household size to qualify for Chapter 7, but you’ll also have to include the income of everyone included in your household.

Don’t List Child Support as Income if You Have Not Received It

It’s only income when you receive it. Likewise, it’s only a deductible expense when you’ve actually paid it.

Contact an Experienced Rockwall, TX Bankruptcy Attorney

At the Law Offices of Carrie Weir, all potential clients are entitled to a free initial consultation. To arrange an appointment, contact my office online or call 972-772-3083. I handle Texas personal bankruptcy filings in Kaufman County, Rockwall County, Collin County, Dallas County, Hunt County and the surrounding counties.

Call Rockwall bankruptcy lawyer Carrie Weir at 972-772-3083 or fill out the contact from below for a free, confidential consultation to discuss your options.

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