Means Testing and Oklahoma Bankruptcy Law

Means testing and Oklahoma bankruptcy go hand in hand. In order to qualify for chapter 7 bankruptcy you must not make above a certain amount of money per year. Means testing in bankruptcy determines which chapter of bankruptcy you qualify to file.

Means Testing Qualifies You

Your income determines which chapter of bankruptcy you qualify to file. If you’d like to file a chapter 7 bankruptcy, means testing is the tool used to qualify you. Means testing in bankruptcy places an upper limit on your income. The test is determined by using IRS guidelines. The guidelines measure a persons income against the median income. The guidelines are specific to the county that you live in. By measuring your income against those in the county that you live the income is measured regionally rather than nationally.

Family Size Matters

Size matters in an Oklahoma bankruptcy. The means test allows for moreMEans Testing and Oklahoma Bankruptcy income the larger your family is. This means that a family of one is allowed way less income then a family of four. But it also considers the income from the family as a whole. If you’re married and you’re the only one filing, the test still uses your spouses income to determine what you qualify for. Basically, if you are supporting family members, be them grandchildren or parents, they are part of your family for the purpose of the means test.

Past Six Months Income Matters

To qualify for a chapter 7 in Oklahoma you cant make over a certain amount of money. The means does look at your last 2 years of earnings but its the last six months that matters the most. The reason is that people may have made large sums of money in the last few years but things have since changed. An example of this is those people who suffer unexpected job loos or illness. The means test will take your last 6 months income and multiply it by two. The sum of that number represents your yearly income for the purpose of satisfying the bankruptcy means test.

Only Consumer Debt is Means Tested

Means testing requirement in chapter 7 only applies to those with consumer debt. This means that if your debt was primarily debt other then consumer debt the means test doesn’t apply. If the majority of the debt is associated with business you’re in the clear. But, its not that simple. When the court measure consumer debt versus business debt they’ll consider all of your consumer debt. This means that if you have one hundred thousand of business debt but owe two hundred thousand dollars on you home mortgage you will still have to use the means test. This is because the debt on the house ( Consumer Debt ) exceeds the business debt so the means test applies.

For a Free consultation about bankruptcy law in Oklahoma call to speak to u today. Get the information you need to make the best choice.

Please follow and like us: