Common Mistakes People Make When Taking the Means Test
October 24, 2024 By: Carrie Weir
Errors That Can Jeopardize Your Rights to Protection Under the Bankruptcy Laws
When you’ve concluded that the best way to tackle your financial problems is by filing for protection under U.S. bankruptcy law, one of your first decisions involves the type of bankruptcy petition to file. If you seek protection under Chapter 7, you’ll be able to permanently discharge some of your debts. If you file under Chapter 13, you must reorganize or restructure your debt, setting up new agreements to pay your debts over a three-to-five-year period.
To qualify to file under Chapter 7, though, you must submit to a means test that allows the bankruptcy court to determine whether you have the resources to repay your creditors over a three-to-five-year period. If you do, your only recourse will be to file under Chapter 13.
When taking the means test, there are mistakes you can make that might subject you to greater scrutiny by the court or reduce your likelihood of qualifying to discharge debts. Here are some common mistakes to avoid when completing the means test:
- Make certain you use the correct household size—The means test is based, in part, on household size. Different courts take different views on who must be included and what income must be included. You’ll want the guidance of an experienced bankruptcy attorney.
- Be accurate with your deductions—Make certain you take all the deductions permissible, but don’t take any that are not. Don’t claim any expenses that you cannot support with documentation.
- Make certain your income calculations are correct—The documentation you provide must add up to the same number as your calculations
- Don’t report child support if you haven’t received it.
- You can take your spouse’s separate expenses, even if they aren’t filing bankruptcy with you.
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 to discuss your rights and options in bankruptcy, 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.