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Ellen
Ellen, Attorney
Category: Bankruptcy Law
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Experience:  Bankruptcy Lawyer. Experienced.
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explain the significance of the $166.66 on the chapter 7 means

Resolved Question:

explain the significance of the $166.66 on the chapter 7 means test, is it to do with being short $6000-$8000 monthly income over debts, or if after basic living expenses I can pay $167 or greater toward a $1,200,000 debt I will not be allowed to go bankrupt? and if so what are the alternatives if unable chapter 13?
Submitted: 8 years ago.
Category: Bankruptcy Law
Expert:  Ellen replied 8 years ago.

Hello,


Thank you for your question. I am happy to assist you.



The purpose of the means test is to determine whether you have enough extra income to repay a portion of your unsecured debts. To determine monthly living expenses, the Internal Revenue Service allowable living expenses are used (with certain adjustments), rather than the your actual living expenses. Living expenses are adjusted for your mortgage, car payment, child support, delinquent tax payments and other secured or priority debts.


If you have more than $166.66 left over per month you have failed the means test and cannot obtain a Chapter 7 discharge



I hope that the information which I provided was helpful to you.

Best wishes for a successful outcome. If you have additional questions, please do not hesitate to submit them to me directly.


Thank you,
FLAandNYLAWYER


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